iiSi^? 


GIFT  OF 


THE  INCOME  TAX  LAW 


ii 


SAVINGS    UNION    BANK 
AND    TRUST    COMPANY 

MARKET   STREET   AT   GRANT   AVENUE 
OTARRELL  STREET  AND  SAVINGS  UNION  PLACE 

SAN    FRANCISCO.    CALIFORNIA 


Savings  Union  Bank  and  Trust  Company 


Q  Authorized  by  law  to  act  as  Executor,  Administrator,  Guardian, 
Trustee,  Depositary  under  Order  of  G)urt,  Assignee,  Receiver,  and 
prepared  to  undertake  Trusts  and  Escrows  of  all  kinds  for  Indi- 
viduals or  Corporations. 

flFor  information  concerning  the  Income  Tax  and  the  preparation 
of  statements,  consult 

TRUST  DEPARTMENT 

of 

SAVINGS  UNION  BANK  AND  TRUST  COMPANY 


What  can  the  Trust  Company  do  for  me  ? 

fl  If  you  are  going  away  from  home  and  wish  your  business  to 
have  attention  during  your  absence, 

^  If  you  wish  to  be  relieved  of  the  care  of  your  property  and  the 
collection  of  your  rents,  or  other  income, 

^  U  you  are  concerned  about  having  a  guardian  appointed  for  the 
estate  of  minor  children  or  those  incapable  of  attending  to  their 
own  affairs, 

C[  If  you  are  interested  in  knowing  how  you  may  most  easily  pro- 
vide for  the  distribution  of  your  property, 

^  If  you  wish  to  know  the  cost  of  probating  your  will  and  adminis- 
tering your  estate, 

^  If  you  wish  financial  service  of  any  character. 

Send  for  a  copy  of 

TRUST  COMPANY  SERVICE 

The  booklet  that  tells 

WHAT  A  TRUST  COMPANY  CAN  DO  FOR  YOU  AND 

YOUR  PROPERTY? 


Savings  Union  Bank  and  Trust  Company 


THE 


INCOME  TAX  LAW 


^       CONTAINING 

I.      A  Digest  of  the   Income  Tax  Law,  by  J.  J. 

Scott,  Collector  of  Internal  Revenue  .  Page     3 

II.      Full  Text  of  the  Income  Tax  Law     .      .   Page     9 

III.  Instructions   of  the  United   States   Treasurer 

Regarding  the  Collection  of  the  Income  Tax 
(dated  October  25,  1913)  ....   Page  29 

IV.  Additional  Instructions  with  Reference  to  De- 

duction of  Income  Tax  at  the  Source  on 
Income  of  Individuals  Other  Than  That 
Derived  from  Interest  (dated  October  31, 
1913) Page  40 


SAN   FRANCISCO: 

The  Recorder  Printing  and  Publi&hing  Company, 

1913. 


0lf 


FOREWORD. 

Public  interest  naturally  centers  in  the  Income  Tax  Law  that 
is  now  in  effect.  To  meet  the  demand  for  information  on  this 
subject  the  Savings  Union  Bank  and  Trust  Company  has  issued 
this  pamphlet,  which  contains  a  digest  of  the  law  by  J.  J.  Scott, 
Collector  of  Internal  Revenue,  the  full  text  of  that  portion  of  the 
new  tariff  law  providing  for  a  tax  on  incomes,  and  the  instruc- 
tions issued  by  the  Treasurer  of  the  United  States  regarding  the 
collection  of  the  income  tax,  with  reference  particularly  to  the 
deduction  of  the  income  tax,  at  the  source,  on  interest  maturing 
on  bonds  issued  October  25,  1913;  and  additional  instructions 
issued  October  31,  1913,  with  reference  to  deduction  of  income 
tax  at  the  source  on  income  of  individuals  other  than  that  derived 
from  interest. 

This  is  the  most  complete  compilation  of  information  con- 
cerning the  Income  Tax  Law  that  has  yet  been  made,  and  is 
authentic  and  official. 


A  DIGEST  OF  THE  INCOME  TAX  LAW 


By  JOSEPH   J.  SCOTT,   U.  S.   Collector  of   Internal   Revenue. 

In  any  consideration  of  the  new  Federal  Income  Tax  thought 
should  be  given  to  the  two  distinct  divisions  of  the  tax,  viz.,  the 
normal  tax  of  one  per  cent  on  all  net  incomes  in  excess  of  the 
specified  exemptions  and  the  additional,  or  graduated  tax  on 
incomes  above  $20,000  a  year  at  increasing  percentages.  The 
normal  tax  is  assessable  against  both  individuals  and  corpor- 
ations; the  additional  tax  against  only  individuals. 

In  the  abstract  of  the  new  law  herewith  given  this  distinc- 
tion is  drawn,  and  should  be  kept  in  mind.  For  convenience  the 
term  "Persons"  is  employed  to  designate  individuals  as  con- 
trasted with  corporate  taxpayers.  The  latter  are  assembled  under 
the  term  "Corporations,"  but  in  their  number  are  included  all 
corporations,  joint-stock  companies  or  associations,  as  well  as 
insurance  companies.  Thus,  the  general  reference  to  "persons" 
and  "corporations"  may  be  understood. 

PERSONS  AFFECTED. 

1.  Every  citizen  of  the  United  States,  whether  residing  at 
home  or  abroad. 

2.  Every  resident  of  the  United  States,  though  not  a  citizen. 

3.  Every  resident  of  a  foreign  country  deriving  income  from 
the  United  States. 

RATES. 

1.  Normal  tax  of  1  per  cent  on  all  incomes  in  excess  of  $3,000 
a  year. 

2.  Additional  tax  according  to  the  following  scale: 

(a)  One  per  cent  upon  the  amount  by  which  net  income 
exceeds  $20,000  but  does  not  exceed   $50,000. 

(b)  Two  per  cent  upon  the  amount  by  which  net  income 
exceeds  $50,000  but  does  not  exceed  $75,000. 

(c)  Three  per  cent  upon  the  amount  by   which   net   in 
come   exceeds   $75,000   but  does   not   exceed   $100,000, 

(d)  Four   per   cent  upon   the   amount   by   which   net   in 
come  exceeds  $100,000  but  does  not  exceed  $250,000 

(e)  Five   per    cent   upon   the    amount   by   which    net    in 
come  exceeds  $250,000  but  does  not  exceed  $500,000 

(f)  Six  per  cent  upon  the  amount  by  which  net  income 
exceeds   $500,000. 

WHAT  IS  INCO>IE? 

In  general  the  law  takes  cognizance  of  the  following  as  con- 
stituting the  income   of  persons: 

1.  Gains,  profits  and  income  derived  from  salaries,  wages,  or 
compensation   for  personal   services   of  any   kind. 


3t^^^' 


2.  From  professions,  vocations,  businesses,  trade  and  dealings 
in  real  and  personal  property. 

3.  From  interest,  rent,  dividends,  or  securities,  and  the  income 
from,  but  not  the  value  of  property  acquired  by  gift,  bequest  or 
descent.  j  iu  J 
INCOME  NOT  TAXABLE. 

Proceeds  of  life  insurance  policies  received  by  the  beneficiary 
upon  the  death  of  the  insured,  or  payments  made  to  the  insured 
on  endowment  or  annuity  contracts  are  not  taxable. 

DEDUCTIONS  FOR  PERSONS. 

Net  income  of  persons  for  the  purpose  of  the  normal  tax  will 
be  computed  by  deducting  from  gross  income  the  following  items: 

1.  Necessary  and  actual  expenses  of  carrying  on  business 
(not  including  personal  living  or  family  expenses). 

2.  All   interest  paid  during  the  year  on  indebtedness. 

3.  All  national,  state,  county,  school  and  municipal  taxes. 
(Not  including  taxes  assessed  against  local  benefits.) 

4.  Losses  in  trade  or  by  fire,  storm  or  shipwreck,  not  com- 
pensated for  by  insurance  or  otherwise. 

5.  Worthless   accounts   actually   charged    off   during   the   year. 

6.  Reasonable  allowance  for  exhaustion,  wear  and  tear  of 
property  through  use.  In  the  case  of  mines  the  allowance  for 
depletion  of  ores  and  other  natural  deposits  shall  not  exceed 
5  per  cent  of  the  value  at  the  mine  of  the  output  for  the  year. 
This  provision  also  covers  oil  wells.  Under  no  circumstances  is 
a  deduction  allowed  for  any  amount  paid  out  for  new  buildings 
or  permanent  improvements. 

7.  Dividends  on  stock  or  from  the  net  earnings  of  any  cor- 
poration taxable  on  its  net  income.  The  personal  return  must, 
however,  include  such  dividends  in  order  that  they  may  be  con- 
sidered in  the  computation  of  the  additional  tax  for  individuals. 
As  far  as  the  normal  tax  for  individuals  is  concerned  such 
dividends  are  not  considered  a  part  of  personal  incomes,  being 
taxed  to  that  extent  by  direct  assessment  against  the  cor- 
porations. 

8.  Amount  of  income  upon  which  the  tax  has  been  paid  or 
withheld   for  payment  at  the  source. 

9.  General  exemption  of  $3,000.  Then  $1,000  extra  if  the 
person  making  the  return  have  a  wife  living  with  him,  or  a 
husband  living  with  her.  However,  should  both  husband  and 
wife  have  taxable  incomes  and  be  living  together,  the  total 
exemption  is  $4,000. 

COLLECTION  AT  SOURCE. 

The  general  provision  is  that  the  normal  tax  of  1  per  cent 
shall  be  withheld  by  all  persons,  firms,  copartnerships,  companies, 
corporations,  joint-stock  companies  or  associations,  and  insurance 
companies,  in  whatever  capacity  acting.  This  also  applies  to 
lessees  or  mortgagors  of  real  or  personal  property,  to  trustees, 
executors,  administrators,  agents,   receivers,   conservators  and  em- 


ployers,  having  the  control,  receipt,  custody,  disposal  or  payment 
of  interest,  rent,  salaries,  wages,  premiums,  annuities,  or  other 
fixed  or  determinable  annual  income  of  another  person  exceeding 
$3,000  for  the  taxable  year. 

Must  Claim  Deductions. 

The  person  whose  income  tax  is  thus  withheld  must,  in  order 
to  receive  the  benefit  of  the  exemption  of  $3,000  (plus  $1,000  for 
a  wife  or  husband)  file  with  the  withholding  power  a  claim  in 
writing  at  least  30  days  before  the  return  is  due.  This  means 
30  days  prior  to  March  the  first. 

As  to  the  privilege  of  the  person  affected  by  the  withholding 
provision  to  avail  himself  of  the  other  detailed  deductions,  the 
law  provides  that  a  statement  in  writing  shall  be  filed  with  the 
withholding  power  setting  forth  the  person's  income  from  all  other 
sources  and  specifying  the  deductions  asked  for.  The  statement 
will  then  become  a  part  of  the  return  made  in  such  person's 
behalf.  It,  too,  must  be  filed  at  least  30  days  before  the  return 
is  due.  In  this  latter  respect,  however,  the  individual  affected 
can  avail  himself  or  herself  of  filing  such  a  statement  directly 
with  the  Collector  of  Internal  Revenue,  to  be  considered  with  the 
return  made  in  his  or  her  behalf  under  the  withholding  provision. 

Should  the  claim  for  exemptions  and  deductions  not  be  filed 
in  time  to  become  parts  of  the  return  of  income,  there  would 
remain  to  the  person  affected  only  the  right  of  application  for  a 
refund  of  the  tax  after  the  payment  of  the  same. 

Income  from    Bonds. 

The  normal  tax  of  1  per  cent  must  be  withheld  from  pay- 
ments of  interest  upon  bonds,  mortgages,  or  deeds  of  trust,  or 
similar  obligations  of  corporations,  whether  payable  annually  or  at 
shorter  or  longer  periods,  even  though  such  interest  does  not  exceed 
$3,000. 

Incomes  from  Foreign  Sources. 

This  requirement  applies  also  to  coupons,  checks  or  bills  of 
exchange  in  payment  of  interest  upon  the  bonds  of  foreign 
countries,  upon  foreign  mortgages  and  the  stocks  and  bonds  of 
foreign  corporations,  regardless  of  the  amount  or  how  often  due. 

(NOTE — Here  it  should  be  noted  that  the  taxpayer  should  not 
be  confused  by  the  necessity  of  withholding  the  tax  upon 
the  dividends  of  foreign  corporations,  in  view  of  the  pro- 
vision exempting  the  dividends  of  domestic  corporations 
from  either  the  withholding  requirement  or  from  consid- 
eration in  the  assessment  of  the  normal  income  tax  against 
individuals.  The  difference  must  be  apparent.  In  the 
case  of  the  foreign  corporation  the  government  of  the 
United  States  can  tax  only  the  part  of  the  dividends  due 
residents  of  the  United  States  or  citizens  of  the  United 
States  residing  abroad.  In  the  case  of  the  domestic  cor- 
poration the  government  can  levy  and  collect  the  normal 
tax  upon  the  dividends  by  a  direct  assessment  against  the 
corporation.) 


—  6  — 

The  withholding  provision  in  respect  to  foreign  payments 
affects  all  making  such  collections,  and  every  dealer  in  coupons 
representing  foreign  interest  or  dividends,  except  that  dealer  who 
purchases  the  coupons  from  a  banker  or  another  dealer  in  such 
coupons,   must  abide   by   it. 

TAX  ON  CORPORATIONS. 

Domestic  and  Foreign. 
For  those  corporations  organized  in  the  United  States  the 
normal  income  tax  will  be  levied  iipon  the  entire  net  income; 
but  for  those  organized  under  the  laws  of  a  foreign  country  upon 
the  net  income  accruing  from  business  transacted  and  capital 
invested  in  the  United  States. 

Tiiose  Exempt. 
The   following  exceptions   among  corporations   are   specified   as 
exempt  from  the  tax: 

1.  Labor  organizations. 

2.  Agricultural  and  horticultural  associations. 

3.  Mutual  savings  banks  not  having  capital  stock  represented 
by  shares. 

4.  Fraternal   beneficiary   societies   and   orders. 

5.  Domestic   building   and   loan   associations. 

6.  Mutual  cemetery  companies. 

7.  Religious,  charitable,  scientific  and  educational  associations. 

8.  Chambers  of  commerce,  boards  of  trade,  and  civic  organiza- 
tions in  general. 

CORPORATION'S  TAXABIiE  INCOME. 

The  net  income  of  any  domestic  corporation  will  be  ascer- 
tained by  deducting  from  gross  income  the  following  items: 

1.  All  ordinary  and  necessary  expenses  for  maintenance  and 
operation,  including  rent. 

2.  All  losses  actually  sustained  and  not  compensated  for  by 
insurance  or  otherwise.  Here  will  be  considered  a  reasonable 
allowance  for  depreciation  by  use,  wear  and  tear  of  property,  if 
any.  In  the  case  of  mines  the  allowance  will  be  figured  as  here- 
tofore noted  in  determining  the  nee  income  of  persons. 

3.  Amount  of  interest  accrued  and  paid  within  the  year  on 
indebtedness  to  an  amount  of  such  indebtedness  not  exceeding 
one-half  the  sum  of  its  interest-bearing  indebtedness  and  its  paid- 
up  capital  at  the  close  of  the  year.  Or,  if  no  capital  stock,  the 
amount  of  interest  paid  within  the  year  on  an  amount  of  its 
indebtedness  not  exceeding  the  amount  of  the  capital  employed 
in  the  business  at  the  close  of  the  year.  In  the  case  of  banks, 
loan  and  trust  companies  the  interest  paid  on  deposits  or  money 
received  for  investment  and  secured  by  certificates.  As  respects 
indebtedness  wholly  secured  by  collateral  which  is  the  subject 
of  sale  in  the  ordinary  business  of  the  corporation,  the  total 
interest  secured  and  paid. 

4.  All  taxes  paid  on  assessments  levied  under  the  authority 
of  the  United  States,  or  any  state,  or  foreign  government. 


—  7  — 

Income  of  Foreign  Corporations. 
The  net  income  of  corporations  existing  under  the  laws  of  a 
foreign  country  will  be  computed  in  practically  the  same  way, 
the  law  taking  cognizance  only  of  the  gross  income  accrued 
during  the  taxable  year  from  business  transacted  and  capital 
invested  within  the  United  States.  The  deductions,  likewise, 
will  be  based  wholly  on  operations  within  the  United  States. 

COLLECTION  OF  TAX. 

Returns  of  incomes,  under  oath,  must  be  in  the  hands  of  the 
Collector  of  Internal  Revenue  not  later  than  March  first. 

The  tax  will  be  due  June  1  and  will  become  delinquent  June 
30,  when  a  penalty  of  5  per  cent  will  accrue  with  interest  at  the 
rate   of  1   per  cent  a  month. 

Wliile  the  law  fixes  the  calendar  year  as  the  taxable  year,  it 
allows  any  corporation  the  right  to  make  its  own  fiscal  year  its 
taxable  year. 

INSURANCE  COMPANIES. 

Insurance  companies  in  making  returns  can  deduct  from  gross 
income  the  net  addition,  if  any,  required  by  law  to  be  made 
within  the  taxable  year  to  reserve  funds;  also  the  sums  other 
than  dividends  paid  on  policy  and  annuity  contracts. 

Mutual  fire  insurance  companies  need  not  make  returns  of 
any  portions  of  premium  deposits  returned  to  policyholders,  but 
must  make  returns  for  taxation  of  all  income  from  other 
sources,  plus  those  portions  of  the  premium  deposits  retained  by 
the  companies  for  purposes  other  than  for  loss,  expenses,  and 
reinsurance  reserves. 

Mutual  marine  insurance  companies  can  deduct  amounts  repaid 
policyholders  on  account  of  premiums  paid  or  on  account  of 
interest  accruing  on  such  amounts  between  the  time  of  becoming 
due  and  payment. 

Life  insurance  companies  need  not  include  that  portion  of 
any  premium  paid  back  or  credited  to  a  policyholder,  or  treated 
as  an  abatement  of  premium. 

OTHER  IMPORTANT  PROVISIONS. 

Public  Utilities  Exempt. 
The  law  provides  that  states  and  their  political  subdivisions 
are  exempted  from  payment  of  the  tax  on  any  income  that 
accrues  to  them  from  the  operation  of  public  utilities,  or  the 
exercise  of  any  governmental  function.  This  exemption  does  not, 
however,  apply  to  the  income  derived  from  any  public  utility  by 
the  person  or  corporation  operating  it. 

Public    Bonds    Not    Taxed. 
In    the    computation    of    net    income    the    interest    upon    the 
obligations  of  a  state  or  any  political  subdivision  of  a  state,  also 
upon   the    obligations    of    the    United    States,    is    excluded.      This 
covers  public  bonds  in  general. 


—  8  — 

Persons    Exempt. 
Exempt  from  the  tax  are  the  salaries  of  the  President  of  the 
United    States,    all    Federal    judges,    and    all    state,    county    and 
municipal  oflScers  and  employees. 

Partners  Are  Individuals. 
In   dealing   with    corporate    taxpayers    the    law    makes    special 
exception  of  partnerships  and  holds  that  the  persons  in  a  partner- 
ship shall  be  liable  for  the  tax  only  in  their  individual  capacity. 

Must    Get    License. 
All   persons,   firms   or   corporations  undertaking   the   collection 
of  foreign   incomes   must  obtain   a  license   by   application  to   the 
Collector  of  Internal  Revenue. 

Undivided  Profits. 

Undivided  and  undistributed  profits  will  be  considered  in 
ascertaining   the   net    income    of   persons. 

Accumulation  of  profits  for  the  purpose  of  evading  the  law 
will  not  avail  because  the  fact  that  profits  are  allowed  to 
accumulate  beyond  the  reasonable  needs  of  a  business  will  be 
regarded  as  prima  facie  evidence  of  a  fraudulent  purpose. 

No  Double  Taxation. 
Double  Taxation  of  corporation  dividends  is  prevented  by 
assessing  the  normal  income  tax  on  such  dividends  against  the 
corporations  and  not  against  the  individuals  receiving  them. 
It  will  be  noted,  however,  that  when  corporation  dividends  con- 
tribute to  individual  incomes  subject  to  the  additional  tax  they 
enter   into  the   computation  of  net  incomes. 

The  Tax  for  1913. 
The  tax  for  the  year  1913,  will  be  collected  for  that  part  of 
the  calendar  year  beginning  March  1  and  ending  December  31. 
All  deductions  and  exemptions  will  be  figured  on  a  five-sixths 
basis  in  order  to  arrive  at  five-sixths  of  the  net  income,  which, 
for  1913,  will  be  regarded  as  the  taxable  income. 


For  information  concerning  the  Income  Tax 
and    the   preparation   of   statements   consult 

TRUST    DEPARTMENT 

of 

SAVINGS  UNION  BANK  AND  TRUST  COMPANY 


Savings  Union  Bank  and  Trust  Company 


THE  INCOME  TAX  LAW 

Full  text  of  that  portion  of  "An  Act  to  Reduce  Tariff 
Duties  and  to  Provide  Revenue  for  the  Government,  and  for 
Other  Purposes,"  providing  for  a  tax  upon  the  incomes  of 
all  persons,  corporate  and  private  (H.  R.  3321).  Approved 
October  3,  1913;  in  effect  November  1,   1913. 

Section  II. 

A.  Subdivision  1.  That  there  shall  be  levied,  assessed,  col- 
lected and  paid  annually  upon  the  entire  net  income  arising  or 
accruing  from  all  sources  in  the  preceding  calendar  year  to  every 
citizen  of  the  United  States,  whether  residing  at  home  or  abroad, 
and  to  every  person  residing  in  the  United  States,  though  not  a 
citizen  thereof,  a  tax  of  1  per  centum  per  annum  upon  such  in- 
come, except  as  hereinafter  provided;  and  a  like  tax  shall  be 
assessed,  levied,  collected,  and  paid  annually  upon  the  entire  net 
income  from  all  property  owned  and  of  every  business,  trade,  or 
profession  carried  on  in  the  United  States  by  persons  residing 
elsewhere. 

Subdivision  2.  In  addition  to  the  income  tax  provided  under 
this  section  (herein  referred  to  as  the  normal  income  tax)  there 
shall  be  levied,  assessed,  and  collected  upon  the  net  income  of 
every  individual  an  additional  income  tax  (herein  referred  to 
as  the  additional  tax)  of  1  per  centum  per  annum  upon  the 
amount  by  which  the  total  net  income  exceeds  $20,000  and  does 
not  exceed  $50,000,  and  2  per  centum  per  annum  upon  the 
amount  by  which  the  total  net  income  exceeds  $50,000  and  does 
not  exceed  $75,000,  3  per  centum  per  annum  upon  the  amount 
by  which  the  total  net  income  exceeds  $75,000  and  does  not 
exceed  $100,000,  4  per  centum  per  annum  upon  the  amount  by 
which  the  total  net  income  exceeds  $100,000  and  does  not  exceed 
$250,000,  5  per  centum  per  annum  upon  the  amount  by  which 
the  total  net  income  exceeds  $250,000  and  does  not  exceed  $500,000, 
and  6  per  centum  per  annum  upon  the  amount  by  which  the 
total  net  income  exceeds  $500,000.  All  the  provisions  of  this 
section  relating  to  individuals  who  are  to  be  chargeable  with 
the  normal  income  tax,  so  far  as  they  are  applicable  and  are 
not  inconsistent  with  this  subdivision  of  paragraph  A,  shall 
apply  to  the  levy,  assessment,  and  collection  of  the  additional 
tax  imposed  under  this  section.  Every  person  subject  to  this 
additional  tax  shall,  for  the  purpose  of  its  assessment  and  col- 
lection, make  a  personal  return  of  his  total  net  income  from  all 
sources,  corporate  or  otherwise,  for  the  preceding  calendar  year, 
under  rules  and  regulations  to  be  prescribed  by  the  Commis- 
sioner of  Internal  Revenue  and  approved  by  the  Secretary  of 
the  Treasury.  For  the  purpose  of  this  additional  tax  the  tax- 
able income  of  any  individual  shall  embrace  the  share  to  which 
he  would  be  entitled  of  the  gains  and  profits,  if  divided  or  dis- 
tributed,   whether   divided   or  distributed   or   not,    of   all    corpora- 


—  lo- 
tions, joint-stock  companies,  or  associations  however  created  or 
organized,  formed  or  fraudulently  availed  of  for  the  purpose  of 
preventing  the  imposition  of  such  tax  through  the  medium  of 
permitting  such  gains  and  profits  to  accumulate  instead  of  being 
divided  or  distributed;  and  the  fact  that  any  such  corporation, 
joint-stock  company,  or  association,  is  a  mere  holding  company, 
or  that  the  gains  and  profits  are  permitted  to  accumulate  beyond 
the  reasonable  needs  of  business  shall  be  prima  facie  evidence 
of  a  fraudulent  purpose  to  escape  such  tax;  but  the  fact  that 
the  gains  and  profits  are  in  any  case  permitted  to  accumulate 
and  become  surplus  shall  not  be  construed  as  evidence  of  a 
purpose  to  escape  the  said  tax  in  such  case  unless  the  Secretary 
of  the  Treasury  shall  certify  that  in  his  opinion  such  accumu- 
lation is  unreasonable  for  the  purposes  of  the  business.  When 
requested  by  the  Commissioner  of  Internal  Revenue,  or  any 
district  collector  of  internal  revenue,  such  corporation,  joint- 
stock  company,  or  association  shall  forward  to  him  a  correct 
statement  of  such  profits  and  the  names  of  the  individuals  who 
would  be  entitled  to  the  same   if  distributed. 

B.  That,  subject  only  to  such  exemptions  and  deductions  as 
are  hereinafter  allowed,  the  net  income  of  a  taxable  person  shall 
include  gains,  profits,  and  income  derived  from  salaries,  wages, 
or  compensation  for  personal  service  of  whatever  kind  and  in 
whatever  form  paid,  or  from  professions,  vocations,  businesses, 
trade,  commerce,  or  sales,  or  dealings  in  property,  whether  real 
or  personal,  growing  out  of  the  ownership  or  use  of  or  interest 
in  real  or  personal  property,  also  from  interest,  rent,  dividends, 
securities,  or  the  transaction  of  any  lawful  business  carried  on 
for  gain  or  profit,  or  gains  or  profits  and  income  derived  from 
any  source  whatever,  including  the  income  from  but  not  the  value 
of  property  acquired  by  gift,  bequest,  devise,  or  descent:  Pro- 
vided, That  the  proceeds  of  life  insurance  policies  paid  upon  the 
death  of  the  person  insured  or  payments  made  by  or  credited 
to  the  insured,  on  life  insurance,  endowment,  or  annuity  con- 
tracts, upon  the  return  thereof  to  the  insured  at  the  maturity 
of  the  term  mentioned  in  the  contract,  or  upon  surrender  of 
contract,  shall  not  be  included  as  income. 

That  in  computing  net  income  for  the  purpose  of  the  normal 
tax  there  shall  be  allowed  as  deductions:  First,  the  necessary  ex- 
penses actually  paid  in  carrying  on  any  business,  not  including 
personal,  living,  or  family  expenses;  second,  all  interest  paid  with- 
in the  year  by  a  taxable  person  on  indebtedness;  third,  all  na- 
tional, State,  county,  school,  and  municipal  taxes  paid  within  the 
year,  not  including  those  assessed  against  local  benefits;  fourth, 
losses  actually  sustained  during  the  year,  incurred  in  trade  or 
arising  from  fires,  storms,  or  shipwreck,  and  not  compensated  for 
by  insurance  or  otherwise;  fifth,  debts  due  to  the  taxpayer  actually 
ascertained  to  be  worthless  and  charged  off  within  the  year;  sixth, 
a  reasonable  allowance  for  the  exhaustion,  wear  and  tear  of  prop- 
erty arising  out  of  its  use  or  employment  in  the  business,  not  to 
exceed,  in  the  case  of  mines,  5  per  centum  of  the  gross  value  at 
the  mine  of  the  output  for  the  year  for  which  the  computation  is 


—  11  — 

made,  but  no  deduction  shall  be  made  for  any  amount  of  expense 
of  restoring  property  or  making  good  the  exhaustion  thereof  for 
which  an  allowance  is  or  has  been  made:  Provided,  That  no  de- 
duction shall  be  allowed  for  any  amount  paid  out  for  new  build- 
ings, permanent  improvements,  or  betterments,  made  to  increase 
the  value  of  any  property  or  estate;  seventh,  the  amount  received 
as  dividends  upon  the  stock  or  from  the  net  earnings  of  any  cor- 
poration, joint-stock  company,  association,  or  insurance  company 
which  is  taxable  upon  its  net  income  as  hereinafter  provided; 
eighth,  the  amount  of  income,  the  tax  upon  which  has  been  paid 
or  withheld  for  payment  at  the  source  of  the  income,  under  the 
provisions  of  this  section,  provided  that  whenever  the  tax  upon  the 
income  of  a  person  is  required  to  be  withheld  and  paid  at  the 
source  as  hereinafter  required,  if  such  annual  income  does  not 
exceed  the  sum  of  $3,000  or  is  not  fixed  or  certain,  or  is  in- 
definite, or  irregular  as  to  amount  or  time  of  accrual,  the  same  sh5,ll 
not  be  deducted  in  the  personal  return  of  such  person. 

The  net  income  from  property  owned  and  business  carried  on  in 
the  United  States  by  persons  residing  elsewhere  shall  be  com- 
puted upon  the  basis  prescribed  in  this  paragraph  and  that  part  of 
paragraph  G  of  this  section  relating  to  the  computation  of  the  net 
Income  of  corporations,  joint-stock  and  insurance  companies,  or- 
ganized, created,  or  existing  under  the  laws  of  foreign  countries, 
in  so  far  as  applicable. 

That  in  computing  net  income  under  this  section  there  shall  be 
excluded  the  interest  upon  the  obligations  of  a  State  or  any  political 
subdivision  thereof,  and  upon  the  obligations  of  the  United  States 
or  its  possessions;  also  the  compensation  of  the  present  President 
of  the  United  States  during  the  term  for  which  he  has  been 
elected,  and  of  the  judges  of  the  supreme  and  inferior  courts  of 
the  United  States  now  in  oflice,  and  the  compensation  of  all  officers 
and  employees  of  a  State  or  any  political  subdivision  thereof  ex- 
cept when  such  compensation  is  paid  by  the  United  States  Gov- 
ernment. 

C.  That  there  shall  be  deducted  from  the  amount  of  the  net 
income  of  each  of  said  persons,  ascertained  as  provided  herein,  the 
sum  of  $3,000,  plus  $1,000  additional  if  the  person  making  the 
return  be  a  married  man  with  a  wife  living  with  him,  or  plus  the 
sum  of  $1,000  additional  if  the  person  making  the  return  be  a 
married  woman  with  a  husband  living  with  her;  but  in  no  event 
shall  this  additional  exemption  of  $1,000  be  deducted  by  both  a 
husband  and  a  wife:  Provided,  That  only  one  deduction  of  $4,000 
shall  be  made  from  the  aggregate  income  of  both  husband  and  wife 
when  living  together. 

D.  The  said  tax  shall  be  computed  upon  the  remainder  of  said 
net  income  of  each  person  subject  thereto,  accruing  during  each 
preceding  calendar  year  ending  December  thirty-first:  Provided, 
however.  That  for  the  year  ending  December  thirty-first,  nineteen 
hundred  and  thirteen,  said  tax  shall  be  computed  on  the  net  in- 
come accruing  from  March  first  to  December  thirty-first,  nineteen 
hundred  and  thirteen,  both  dates  inclusive,  after  deducting  five- 
sixths  only  of  the  specific  exemptions  and  deductions  herein  pro- 
vided for.     On  or  before  the  first  day  of  March,  nineteen  hundred 


—  12  — 

and  fourteen,  and  the  first  day  of  March  in  each  year  thereafter,  a 
true  and  accurate  return,  under  oath  or  aflarmation,  shall  be  made 
by  each  person  of  lawful  age,  except  as  hereinafter  provided, 
subject  to  the  tax  imposed  by  this  section,  and  having  a  net  income 
of  $3,000  or  over  for  the  taxable  year,  to  the  collector  of  internal 
revenue  for  the  district  in  which  such  person  resides  or  has  his 
principal  place  of  business,  or,  in  the  case  of  a  person  residing  in 
a  foreign  country,  in  the  place  where  his  principal  business  is 
carried  on  within  the  United  States,  in  such  form  as  the  Commis- 
sioner of  Internal  Revenue,  with  the  approval  of  the  Secretary  of 
the  Treasury,  shall  prescribe,  setting  forth  specifically  the  gross 
amount  of  income  from  all  separate  sources  and  from  the  total 
thereof,  deducting  the  aggregate  items  or  expenses  and  allowances 
herein  authorized;  guardians,  trustees,  executors,  administrators, 
agents,  receivers,  conservators,  and  all  persons,  corporations,  or 
associations  acting  in  any  fiduciary  capacity,  shall  make  and  render 
a  return  of  the  net  income  of  the  person  for  whom  they  act,  subject 
to  this  tax,  coming  into  their  custody  or  control  and  management, 
and  be  subject  to  all  the  provisions  of  this  section  which  apply  to 
individuals:  Provided,  That  a  return  made  by  one  of  two  or  more 
joint  guardians,  trustees,  executors,  administrators,  agents,  re- 
ceivers, and  conservators,  or  other  persons  acting  in  a  fiduciary 
capacity,  filed  in  the  district  where  such  person  resides,  or  in  the 
district  where  the  will  or  other  instrument  under  which  he  acts  is 
recorded,  under  such  regulations  as  the  Secretary  of  the  Treasury 
may  prescribe,  shall  be  a  sufficient  compliance  with  the  require- 
ments of  this  paragraph;  and  also  all  persons,  firms,  companies,  co- 
partnerships, corporations,  joint-stock  companies  or  associations,  and 
insurance  companies,  except  as  hereinafter  provided,  in  whatever 
capacity  acting,  having  the  control,  receipt,  disposal,  or  payment  of 
fixed  or  determinable  annual  or  periodical  gains,  profits,  and  income 
of  another  person  subject  to  tax,  shall  in  behalf  of  such  person 
deduct  and  withhold  from  the  payment  an  amount  equivalent  to  the 
normal  income  tax  upon  the  same  and  make  and  render  a  return,  as 
aforesaid,  but  separate  and  distinct,  of  the  portion  of  the  income  of 
each  person  from  which  the  normal  tax  has  been  thus  withheld,  and 
containing  also  the  name  and  address  of  such  person  or  stating 
that  the  name  and  address  or  the  address,  as  the  case  may  be,  are 
unknown:  Provided,  That  the  provision  requiring  the  normal  tax 
of  individuals  to  be  withheld  at  the  source  of  the  income  shall  not 
be  construed  to  require  any  of  such  tax  to  be  withheld  prior  t©  the 
first  day  of  November,  nineteen  hundred  and  thirteen:  Provided 
further.  That  in  either  case  above  mentioned  no  return  of  income 
not  exceeding  $3,000  shall  be  required:  Provided  further,  That  any 
persons  carrying  on  business  In  partnership  shall  be  liable  for  in- 
come tax  only  in  their  individual  capacity,  and  the  share  of  the 
profits  of  a  partnership  to  whigh  any  taxable  partner  would  be  en- 
titled if  the  same  were  divided,  whether  divided  or  otherwise,  shall 
be  returned  for  taxation  and  the  tax  paid,  under  the  provisions  of 
this  section,  and  any  such  firm,  when  requested  by  the  Commis- 
sioner of  Internal  Revenue,  or  any  district  collector,  shall  forward 
to  him  a  correct  statement  ot  such  profits  and  the  names  of  the 
individuals  who  would  be  entitled  to  the  same,  if  distributed:  Pro- 


—  13  — 

vided  further,  That  persons  liable  for  the  normal  income  tax  only, 
on  their  own  account  or  in  behalf  of  another,  shall  not  be  required 
to  make  return  of  the  income  derived  from  dividends  on  the  capital 
stock  or  from  the  net  earnings  of  corporations,  joint-stock  com- 
panies or  associations,  and  insurance  companies  taxable  upon  their 
net  income  as  hereinafter  provided.  Any  person  for  whom  return 
has  been  made  and  the  tax  paid,  or  to  be  paid  as  aforesaid,  shall  not 
be  required  to  make  a  return  unless  such  person  has  other  net  in- 
come, but  only  one  deduction  of  $3,000  shall  be  made  in  the  case  of 
any  such  person.  The  collector  or  deputy  collector  shall  require 
every  list  to  be  verified  by  the  oath  or  aflarmation  of  the  party 
rendering  it.  If  the  collector  or  deputy  collector  have  reason  to 
believe  that  the  amount  of  any  income  returned  is  understated,  he 
shall  give  due  notice  to  the  person  making  the  return  to  show  cause 
why  the  amount  of  the  return  should  not  be  increased,  and  upon 
proof  of  the  amount  understated  may  increase  the  same  accord- 
ingly. If  dissatisfied  with  the  decision  of  the  collector,  such  person 
may  submit  the  case,  with  all  the  papers,  to  the  Commissioner  of 
Internal  Revenue  for  his  decision,  and  may  furnish  sworn  testi- 
mony of  witnesses  to  prove  any  relevant  facts. 

E.  That  all  assessments  shall  be  made  by  the  Commissioner  of 
Internal  Revenue  and  all  penions  shall  be  notified  of  the  amount  for 
which  they  are  respectively  liable  on  or  before  the  first  day  of  June 
of  each  successive  year,  and  said  assessments  shall  be  paid  on  or 
before  the  thirtieth  day  of  June,  except  in  cases  of  refusal  or  neglect 
to  make  such  return  and  in  cases  of  false  or  fraudulent  returns,  in 
which  cases  the  Commissioner  of  Internal  Revenue  shall,  upon  the 
discovery  thereof,  at  any  time  within  three  years  after  said  return  is 
due,  make  a  return  upon  the  information  obtained  as  provided  for  in 
this  section  or  by  existing  law,  and  the  assessment  made  by  the 
Commissioner  of  Internal  Revenue  thereon  shall  be  paid  by  such 
person  or  persons  immediately  upon  notification  of  the  amount  of 
such  assessment;  and  to  any  sum  or  sums  due  and  unpaid  after  the 
thirtieth  day  of  June  in  any  year,  and  for  ten  days  after  notice  and 
demand  thereof  by  the  collector,  there  shall  be  added  the  sum  of  5 
per  centum  on  the  amount  of  tax  unpaid,  and  interest  at  the  rate  of 
1  per  centum  per  month  upon  said  tax  from  the  time  the  same  be- 
came due,  except  from  the  estates  of  insane,  deceased,  or  insolvent 
persons. 

All  persons,  firms,  copartnerships,  companies,  corporations,  joint- 
stock  companies  or  associations,  and  insurance  companies,  in  what- 
ever capacity  acting,  including  lessees,  or  mortgagors  of  real  or  per- 
sonal property,  trustees  acting  in  any  trust  capacity,  executors,  ad- 
ministrators, agents,  receivers,  conservators,  employers,  and  all 
ofiicers  and  employees  of  tlie  United  States  having  the  control,  re- 
ceipt, custody,  disposal,  or  payment  of  interest,  rent,  salaries,  wages, 
premiums,  annuities,  compensation,  remuneration,  emoluments,  or 
other  fixed  or  determinable  annual  gains,  profits,  and  income  of 
another  person,  exceeding  $3,000  for  any  taxable  year,  other  than 
dividends  on  capital  stock,  or  from  the  net  earnings  of  corporations 
and  joint-stock  companies  or  associations  subject  to  like  tax,  who  are 
required  to  make  and  render  a  return  in  behalf  of  another,  as  pro- 
vided herein,  to  the  collect  Dr  of  his,  her,  or  its  district,  are  hereby 


—  14-- 

authorized  and  required  to  deduct  and  withhold  from  such  annual 
gains,  profits,  and  income  such  sum  as  will  be  sufficient  to  pay  the 
normal  tax  imposed  thereon  by  this  section,  and  shall  pay  to  the 
officer  of  the  United  States  Government  authorized  to  receive  the 
same;  and  they  are  each  hereby  made  personally  liable  for  such  tax. 
In  all  cases  where  the  income  tax  of  a  person  is  withheld  and  de- 
ducted and  paid  or  to  be  paid  at  the  source,  as  aforesaid,  such  per- 
son shall  not  receive  the  benefit  of  the  deduction  and  exemption 
allowed  in  paragraph  C  of  this  section  except  by  an  application  for 
refund  of  the  tax  unless  he  shall,  not  less  than  thirty  days  prior  to 
the  day  on  which  the  return  of  his  income  is  due,  file  with  the  per- 
son who  is  required  to  withhold  and  pay  tax  for  him,  a  signed  notice 
in  writing  claiming  the  benefit  of  such  exemption  and  thereupon  no 
tax  shall  be  withheld  upon  the  amount  of  such  exemption:  Provided, 
That  if  any  person  for  the  purpose  of  obtaining  any  allowance  or 
reduction  by  virtue  of  a  claim  for  such  exemption,  either  for  himself 
or  for  any  other  person,  knowingly  makes  any  false  statement  or 
false  or  fraudulent  representation,  he  shall  be  liable  to  a  penalty  of 
$300;  nor  shall  any  person  under  the  foregoing  conditions  be  al- 
lowed the  benefit  of  any  deduction  provided  for  in  subsection  B 
of  this  section  unless  he  shall,  not  less  than  thirty  days  prior  to  the 
day  on  which  the  return  of  his  income  is  due,  either  file  with  tlie 
person  who  is  required  to  withhold  and  pay  tax  for  him  a  true  and 
correct  return  of  his  annual  gains,  profits,  and  income  from  all  other 
sources,  and  also  the  deductions  asked  for,  and  the  showing  thus 
made  shall  then  become  a  part  of  the  return  to  be  made  in  his  behalf 
by  the  person  required  to  withhold  and  pay  the  tax,  or  likewise 
make  application  for  deductions  to  the  collector  of  the  district  in 
which  return  is  made  or  to  be  made  for  him:  Provided  further. 
That  if  such  person  is  a  minor  or  an  insane  person,  or  is  absent 
from  the  United  States,  or  is  unable  owing  to  serious  illness  to  make 
the  return  and  application  above  provided  for,  the  return  and  appli- 
cation may  be  made  for  him  or  her  by  the  person  required  to  with- 
hold and  pay  the  tax,  he  making  oath  under  the  penalties  of  this 
Act  that  he  has  sufficient  knowledge  of  the  affairs  and  property  of 
his  beneficiary  to  enable  him  to  make  a  full  and  complete  return  for 
him  or  her,  and  that  the  return  and  application  made  by  him  are 
full  and  complete:  Provided  further,  That  the  amount  of  the  normal 
tax  hereinbefore  imposed  shall  be  deducted  and  withheld  from  fixed 
and  determinable  annual  gains,  profits,  and  income  derived  from 
interest  upon  bonds  and  mortgages,  or  deeds  of  trust  or  other  similar 
obligations  of  corporations,  joint-stock  companies  or  associations, 
and  insurance  companies,  whether  payable  annually  or  at  shorter  or 
longer  periods,  although  such  interest  does  not  amount  to  $3,000, 
subject  to  the  provisions  of  this  section  requiring  the  tax  to  be 
withheld  at  the  source  and  deducted  from  annual  income  and  paid 
to  the  Government;  and  likewise  the  amount  of  such  tax  shall  be 
deducted  and  withheld  from  coupons,  checks,  or  bills  of  exchange 
for  or  in  payment  of  interest  upon  bonds  of  foreign  countries  and 
upon  foreign  mortgages  or  like  obligations  (not  payable  in  the 
United  States),  and  also  from  coupons,  checks,  or  bills  of  exchange 
for  or  in  payment  of  any  dividends  upon  the  stock  or  interest  upon 
the  obligations  of  foreign  corporations,  associations,  and  insurance 


— 15  — 

companies  engaged  in  business  in  foreign  countries;  and  the  tax  in 
each  case  shall  be  withheld  and  deducted  for  and  in  behalf  of  any 
person  subject  to  the  tax  hereinbefore  imposed,  although  such  inter- 
est, dividends,  or  other  compensation  does  not  exceed  $3,000,  by  any 
banker  or  person  who  shall  sell  or  otherwise  realize  coupons,  checks, 
or  bills  of  exchange  drawn  or  made  in  payment  of  any  such  interest 
or  dividends  (not  payable  in  the  United  States),  and  any  person  who 
shall  obtain  payment  (not  in  the  United  States),  in  behalf  of  another 
of  such  dividends  and  interest  by  means  of  coupons,  checks,  or  bills 
of  exchange,  and  also  any  dealer  in  such  coupons  who  shall  purchase 
the  same  for  any  such  dividends  or  interest  (not  payable  in  the 
United  States),  otherwise  than  from  a  banker  or  another  dealer  in 
such  coupons;  but  in  each  case  the  benefit  of  the  exemption  and  the 
deduction  allowable  under  this  section  may  be  had  by  complying 
with  the  foregoing  provisions  of  this  paragraph. 

All  persons,  firms,  or  corporations  undertaking  as  a  matter  of 
business  or  for  profit  the  collection  of  foreign  payments  of  such 
interest  or  dividends  by  means  of  coupons,  checks,  or  bills  of  ex- 
change shall  obtain  a  license  from  the  Commissioner  of  Internal 
Revenue,  and  shall  be  subject  to  such  regulations  enabling  the  Gov- 
ernment to  ascertain  and  verify  the  due  withholding  and  payment 
of  the  income  tax  required  to  be  withheld  and  paid  as  the  Commis- 
sioner of  Internal  Revenue,  with  the  approval  of  the  Secretary  of  the 
Treasury,  shall  prescribe;  and  any  person  who  shall  knowingly  un- 
dertake to  collect  such  payments  as  aforesaid  without  having  ob- 
tained a  license  therefor,  or  without  complying  with  such  regu- 
lations, shall  be  deemed  guilty  of  a  misdemeanor  and  for  each  offense 
be  fined  in  a  sum  not  exceeding  $5,000,  or  imprisoned  for  a  term 
not  exceeding  one  year,  or  both,  in  the  discretion  of  the  court. 

Nothing  in  this  section  shall  be  construed  to  release  a  taxable 
person  from  liability  for  income  tax,  nor  shall  any  contract  entered 
into  after  this  Act  takes  effect  be  valid  in  regard  to  any  Federal 
income  tax  imposed  upon  a  person  liable  to  such  payment. 

The  tax  herein  imposed  upon  annual  gains,  profits,  and  income 
not  falling  under  the  foregoing  and  not  returned  and  paid  by  virtue 
of  the  foregoing  shall  be  assessed  by  personal  return  under  rules  and 
regulations  to  be  prescribed  by  the  Commissioner  of  Internal 
Revenue  and  approved  by  the  Secretary  of  the  Treasury. 

The  provisions  of  this  section  relating  to  the  deduction  and  pay- 
ment of  the  tax  at  the  source  of  income  shall  only  apply  to  the 
normal  tax  hereinbefore  imposed  upon  individuals. 

F.  That  if  any  person,  corporation,  joint-stock  company,  associa- 
tion, or  insurance  company  liable  to  make  the  return  or  pay  the  tax 
aforesaid  shall  refuse  or  neglect  to  make  a  return  at  the  time  or 
times  hereinbefore  specified  in  each  year,  such  person  shall  be  liable 
to  a  penalty  of  not  less  than  $20  nor  more  than  $1,000.  Any  person 
or  any  officer  of  any  corporation  required  by  law  to  make,  render, 
sign,  or  verify  any  return  who  makes  any  false  or  fraudulent  return 
or  statement  with  intent  to  defeat  or  evade  the  assessment  required 
by  this  section  to  be  made  shall  be  guilty  of  a  misdemeanor,  and 
shall  be  fined  not  exceeding  $2,000  or  be  imprisoned  not  exceeding 
one  year,  or  both,  at  the  discretion  of  the  court,  with  the  costs  of 
prosecution. 


—  16  — 

G.  (a)  That  the  normal  tax  hereinbefore  imposed  upon  individ- 
uals likewise  shall  be  levied,  assessed,  and  paid  annually  upon  the 
entire  net  income  arising  or  accruing  from  all  sources  during  the 
preceding  calendar  year  to  every  corporation,  joint-stock  company 
or  association,  and  every  insurance  company,  organized  in  the 
United  States,  no  matter  how  created  or  organized,  not  including 
partnerships;  but  if  organized,  authorized,  or  existing  under  the 
laws  of  any  foreign  country,  then  upon  the  amount  of  net  income 
accruing  from  business  transacted  and  capital  invested  within  the 
United  States  during  such  year:  Provided,  however,  That  nothing  in 
this  section  shall  apply  to  labor,  agricultural,  or  horticultural  organ- 
izations, or  to  mutual  savings  banks  not  having  a  capital  stock  repre- 
sented by  shares,  or  to  frr.ternal  beneficiary  societies,  orders,  or  asso- 
ciations operating  under  the  lodge  system  or  for  the  exclusive  bene- 
fit of  the  members  of  a  fraternity  itself  operating  under  the  lodge 
system,  and  providing  for  the  payment  of  life,  sick,  accident,  and 
other  benefits  to  the  members  of  such  societies,  orders,  or  associ- 
ations and  dependents  of  such  members,  nor  to  domestic  building 
and  loan  associations,  nor  to  cemetery  companies,  organized  and 
operated  exclusively  for  the  mutual  benefit  of  their  members,  nor  to 
any  corporation  or  association  organized  and  operated  exclusively 
for  religious,  charitable,  scientific,  or  educational  purposes,  no  part 
of  the  net  income  of  which  inures  to  the  benefit  of  any  private 
stockholder  or  individual,  nor  to  business  leagues,  nor  to  chambers 
of  commerce  or  boards  of  trade,  not  organized  for  profit  or  no  part 
of  the  net  income  of  which  inures  to  the  benefit  of  the  private  stock- 
holder or  individual;  nor  to  any  civic  league  or  organization  not 
organized  for  profit,  but  operated  exclusively  for  the  promotion  of 
social  welfare:  Provided  further.  That  there  shall  not  be  taxed  under 
this  section  any  income  derived  from  any  public  utility  or  from  the 
exercise  of  any  essential  governmental  function  accruing  to  any 
State,  Territory,  or  the  District  of  Columbia,  or  any  political  sub- 
division of  a  State,  Territory,  or  the  District  of  Columbia,  nor  any 
income  accruing  to  the  government  of  the  Philippine  Islands  or 
Porto  Rico,  or  of  any  political  subdivision  of  the  Philippine  Islands 
or  Porto  Rico :  Provided,  That  whenever  any  State,  Territory,  or  the 
District  of  Columbia,  or  any  political  subdivision  of  a  State  or  Terri- 
tory, has,  prior  to  the  passage  of  this  Act,  entered  in  good  faith  into 
a  contract  with  any  person  or  corporation,  the  object  and  purpose  of 
which  is  to  acquire,,  construct,  operate  or  maintain  a  public  utility, 
no  tax  shall  be  levied  under  the  provisions  of  this  Act  upon  the 
income  derived  from  the  operation  of  such  public  utility,  so  far  as 
the  payment  thereof  will  impose  a  loss  or  burden  upon  such  State, 
Territory,  or  the  District  of  Columbia,  or  a  political  subdivision  of  a 
State  or  Territory;  but  this  provision  is  not  intended  to  confer  upon 
such  person  or  corporation  any  financial  gain  or  exemption  or  to  re- 
lieve such  person  or  corporation  from  the  payment  of  a  tax  as  pro- 
vided for  in  this  section  upon  the  part  or  portion  of  the  said  income 
to  which  such  person  or  corporation  shall  be  entitled  under  such 
contract. 

(b)  Such  net  income  shall  be  ascertained  by  deducting  from 
the  gross  amount  of  the  income  of  such   corporation,   joint-stock 


—  17  — 

company  or  association,  or  insurance  company,  received  within 
the  year  from  all  sources,  (first)  all  the  ordinary  and  necessary 
expenses  paid  within  the  year  in  the  maintenance  and  operation 
of  its  business  and  properties,  including  rentals  or  other  pay- 
ments required  to  be  made  as  a  condition  to  the  continued  use 
or  possession  of  property;  If  second)  all  losses  actually  sustained 
within  the  year  and  not  compensated  by  insurance  or  otherwise, 
including  a  reasonable  allowance  for  depreciation  by  use,  wear  and 
tear  of  property,  if  any;  and  in  the  case  of  mines  a  reasonable 
allowance  for  depletion  of  ores  and  all  other  natural  deposits, 
not  to  exceed  5  per  centum  of  the  gross  value  at  the  mine  of 
the  output  for  the  year  for  which  the  computation  is  made; 
and  in  case  of  insurance  companies  the  net  addition,  if  any, 
required  by  law  to  be  made  within  the  year  to  reserve  funds 
and  the  sums  other  than  dividends  paid  within  the  year  on 
policy  and  annuity  contracts;  Provided,  That  mutual  fire  insur- 
ance companies  requiring  their  members  to  make  premium 
deposits  to  provide  for  losses  and  expenses  shall  not  return 
as  income  any  portion  of  the  premium  deposits  returned 
to  their  policyholders,  but  shall  return  as  taxable  income  all 
income  received  by  them  from  all  other  sources  plus  such  por- 
tions of  the  premium  deposits  as  are  retained  by  the  companies 
for  purposes  other  than  the  payment  of  losses  and  expenses  and 
reinsurance  reserves:  Provided  further,  That  mutual  marine  in- 
surance companies  shall  include  in  their  return  of  gross  income 
gross  premiums  collected  and  received  by  them  less  amounts  paid 
for  reinsurance,  but  shall  be  entitled  to  include  in  deductions 
from  gross  income  amounts  repaid  to  policyholders  on  account  of 
premiums  previously  paid  by  them  and  interest  paid  upon  such 
amounts  between  the  ascertainment  thereof  and  the  payment 
thereof  and  life  insurance  companies  shall  not  include  as  income 
in  any  year  such  portion  of  any  actual  premium  received  from 
any  individual  policyholder  as  shall  have  been  paid  back  or 
credited  to  such  individual  policyholder,  or  treated  as  an  abate- 
ment of  premium  of  such  individual  policyholder,  within  such 
year;  (third)  the  amount  of  interest  accrued  and  paid  within 
the  year  on  its  indebtedness  to  an  amount  of  such  indebtedness 
not  exceeding  one-half  of  the  sum  of  its  interest  bearing  indebt- 
edness and  its  paid-up  capital  stock  outstanding  at  the  close  of 
the  year,  or  if  no  capital  stock,  the  amount  of  interest  paid 
within  the  year  on  an  amount  of  its  indebtedness  not  exceeding 
the  amount  of  capital  employed  in  the  business  at  the  close  of 
the  year:  Provided,  That  in  case  of  indebtedness  wholly  secured 
by  collateral  the  subject  of  sale  in  ordinary  business  of  such 
corporation,  joint-stock  company,  or  association,  the  total  inter- 
est secured  and  paid  by  such  company,  corporation,  or  association 
within  the  year  on  any  such  indebtedness  may  be  deducted  as  a 
part  of  its  expense  of  doing  business:  Provided  further.  That  in 
the  case  of  bonds  or  other  indebtedness,  which  have  been  issued 
with  a  guaranty  that  the  interest  payable  thereon  shall  be  free 
from  taxation,  no  deduction  for  the  payment  of  the  tax  herein 
imposed   shall  be  allowed;    and   in   the   case   of  a   bank,   banking 


—  18  — 

association,    loan,    or    trust    company,    interest    paid    within    the 
year    on    deposits    or    on    moneys    received    for    investment    and 
secured  by  interest-bearing  certificates   of  indebtedness   issued  by 
such  bank,  banking  association,  loan  or  trust  company;    (fourth) 
all  sums  paid  by  it  within  the  year  for  taxes  imposed  under  the 
authority    of    the    United    States    or    of    any    State    or    Territory 
thereof,   or  imposed  by  the   Government  of  any  foreign   country: 
Provided,  That  in  the  case  of  a  corporation,  joint-stock  company 
or    association,    or    insurance    company,    organized,    authorized,    or 
existing  under  the  laws  of  any  foreign  country,  such  net  income 
shall  be  ascertained  by  deducting  from  the   gross   amount  of  its 
income    accrued    within    the    year    from    business    transacted    and 
capital  invested  within  the  United  States,   (first)   all  the  ordinary 
and    necessary    expenses    actually    paid    within    the    year    out    of 
earnings   in   the   maintenance  and   operation   of   its   business   and 
property  within  the  United  States,  including  rentals  or  other  pay- 
ments  required  to  be  made  as  a  condition   to   the   continued   use 
or  possession  of  property;    (second)    all  losses  actually  sustained 
within   the   year   in   business  conducted   by   it   within   the   United 
States  and  not  compensated  by  insurance  or  otherwise,   including 
a   reasonable   allowance    for   depreciation    by   use,    wear    and    tear 
of  property,  if  any,  and  in  the  case  of  mines  a  reasonable  allow- 
ance for  depletion  of  ores  and  all  other  natural  deposits,  not  to 
exceed  5  per  centum  of  the  gross  value  at  the  mine  of  the  out- 
put for' the  year  for  which  the  computation  is  made;   and  in  case 
of  insurance  companies  the  net  addition,   if  any,  required  by  law 
to  be  made  within  the  year  to  reserve  funds  and  the  sums  other 
than  dividends  paid  within  the  year  on  policy  and  annuity   con- 
tracts:   Provided   further,    That   mutual   fire    insurance    companies 
requiring   their   members   to   make   premium   deposits    to    provide 
for  losses  and   expenses  shall   not  return   as   income  any  portion 
of    the    premium    deposits    returned    to    their    policyholders,    but 
shall  return  as  taxable  income  all  income  received  by  them  from 
all  other  sources  plus  such  portions  of  the  premium  deposits   as 
are  retained  by  the  companies  for  purposes   other  than  the  pay- 
ment  of  losses  and  expenses  and  reinsurance   reserves:    Provided 
further,    That   mutual    marine   insurance    companies    shall    include 
in   their    return    of   gross    income    gross   premiums    collected    and 
received  by  them  less  amounts  paid  for  reinsurance,  but  shall  be 
entitled    to    include    in    deductions    from    gross    income    amounts 
repaid   to   policyholders   on   account   of  premiums   previously   paid 
by  them,  and  interest  paid  upon  such  amounts  between  the  ascer- 
tainment   thereof    and    the    payment    thereof    and    life    insurance 
companies  shall  not  include  as  income  in  any  year  such  portion 
of  any  actual  premium  received  from  any  individual  policyholder 
as    shall    have    been    paid    back    or    credited    to    such    individual 
policyholder,    or    treated    as    an    abatement    of    premium    of    such 
individual    policyholder,    within    such    year;     (third)    the    amount 
of  interest  accrued  and  paid  within  the  year  on  its  indebtedness 
to  an  amount  of  such   indebtedness  not  exceeding  the  proportion 
of    one-half    of    the    sum    of    its    interest    bearing    indebtedness 
and     its     paid-up     capital     stock     outstanding     at     the     close     of 


—  la- 
the year,  or  if  no  capital  stock,  the  capital  employed  in 
the  business  at  the  close  of  the  year  which  gross  amount 
of  its  income  for  the  year  from  business  transacted  and  capital 
invested  within  the  United  States  bears  to  the  gross  amount  of 
its  income  derived  from  all  sources  within  and  without  the 
United  States:  Provided,  That  in  the  case  of  bonds  or  other  in- 
debtedness which  have  been  issued  with  a  guaranty  that  the 
interest  payable  thereon  shall  be  free  from  taxation,  no  deduc- 
tion for  the  payment  of  the  tax  herein  imposed  shall  be  allowed; 
(fourth)  all  sums  paid  by  it  within  the  year  for  taxes  imposed 
under  the  authority  of  the  United  States  or  of  any  State  or 
Territory  thereof  or  the  District  of  Columbia.  In  the  case  of 
assessment  insurance  companies,  whether  domestic  or  foreign, 
the  actual  deposit  of  sums  with  State  or  Territorial  officers,  pur- 
suant to  law,  as  additions  to  guarantee  or  reserve  funds  shall  be 
treated  as  being  payments  required  by  law  to  reserve  funds. 

(c)  The  tax  herein  imposed  shall  be  computed  upon  its  entire 
net  income  accrued  within  each  preceding  calendar  year  ending 
December  thirty-first:  Provided,  however,  That  for  the  year  end- 
ing December  thirty-first,  nineteen  hundred  and  thirteen,  said 
tax  shall  be  imposed  upon  its  entire  net  income  accrued  within 
that  portion  of  said  year  from  March  first  to  December  thirty- 
first,  both  dates  inclusive,  to  be  ascertained  by  taking  five-sixths 
of  its  entire  net  income  for  said  calender  year:  Provided  fur- 
ther, That  any  corporation,  joint-stock  company  or  association, 
or  insurance  company  subject  to  this  tax  may  designate  the  last 
day  of  any  month  in  the  year  as  the  day  of  the  closing  of  its 
fiscal  year  and  shall  be  entitled  to  have  the  tax  payable  by  it 
computed  upon  the  basis  of  the  net  income  ascertained  as  herein 
provided  for  the  year  ending  on  the  day  so  designated  in  the 
year  preceding  the  date  of  assessment  instead  of  upon  the  basis 
of  the  net  income  for  the  calendar  year  preceding  the  date  of 
assessment;  and  it  shall  give  notice  of  the  day  it  has  thus  desig- 
nated as  the  closing  of  its  fiscal  year  to  the  collector  of  the  dis- 
trict in  which  its  principal  business  office  is  located  at  any  time 
not  less  than  thirty  days  prior  to  the  date  upon  which  its  annual 
return  shall  be  filed.  All  corporations,  joint-stock  companies  or 
associations,  and  insurance  companies  subject  to  the  tax  herein 
imposed,  computing  taxes  upon  the  income  of  the  calendar  year, 
shall,  on  or  before  the  first  day  of  March,  nineteen  hundred  and 
fourteen,  and  the  first  day  of  March  in  each  year  thereafter, 
and  all  corporations,  joint-stock  companies  or  associations,  and 
insurance  companies,  computing  taxes  upon  the  income  of  a  fiscal 
year  which  it  may  designate  in  the  manner  hereinbefore  pro- 
vided, shall  render  a  like  return  within  sixty  days  after  the 
close  of  its  said  fiscal  year,  and  within  sixty  days  after  the  close 
of  its  fiscal  year  in  each  year  thereafter,  or  in  the  case  of  a 
corporation,  joint-stock  company  or  association,  or  insurance 
company,  organized  or  existing  under  the  laws  of  a  foreign 
country,  in  the  place  where  its  principal  business  is  located 
within  the  United  States,  in  such  form  as  the  Commissioner  of 
Internal    Revenue,    with    the    approval    of    the    Secretary    of    the 


—  20  — 

Treasury,  shall  prescribe,  shall  render  a  true  and  accurate  return 
under  oath  or  afl5.rmation  of  its  president,  vice  president,  or  other 
principal  officer,  and  its  treasurer  or  assistant  treasurer,  to  the 
collector  of  internal  revenue  for  the  district  in  which  it  has  its 
principal  place  of  business,  setting  forth  (first)  the  total  amount 
of  its  paid-up  capital  stock  outstanding,  or  if  no  capital  stock, 
its  capital  employed  in  business,  at  the  close  of  the  year;  (sec- 
ond) the  total  amount  of  its  bonded  and  other  indebtedness  at 
the  close  of  the  year;  (third)  the  gross  amount  of  its  income, 
received  during  such  year  from  all  sources,  and  if  organized 
under  the  laws  of  a  foreign  country  the  gross  amount  of  its 
income  received  within  the  year  from  business  transacted  and 
capital  invested  within  the  United  States;  (fourth)  the  total 
amount  of  all  its  ordinary  and  necessary  expenses  paid  out  of 
earnings  in  the  maintenance  and  operation  of  the  business  and 
properties  of  such  corporation,  joint-stock  company  or  associa- 
tion, or  insurance  company  within  the  year,  stating  separately  all 
rentals  or  other  payments  required  to  be  made  as  a  condition 
to  the  continued  use  or  possession  of  property,  and  if  organized 
under  the  laws  of  a  foreign  country  the  amount  so  paid  in  the 
maintenance  and  operation  of  its  business  within  the  United 
States;  (fifth)  the  total  amount  of  all  losses  actually  sustained 
during  the  year  and  not  compensated  by  insurance  or  otherwise, 
stating  separately  any  amounts  allowed  for  depreciation  of  prop- 
erty, and  in  case  of  insurance  companies  the  net  addition,  if  any, 
required  by  law  to  be  made  within  the  year  to  reserve  funds  and 
the  sums  other  than  dividends  paid  within  the  year  on  policy 
and  annuity  contracts:  Provided  further,  That  mutual  fire  insur- 
ance companies  requiring  their  members  to  make  premium  de- 
posits to  provide  for  losses  and  expenses  shall  not  return  as 
income  any  portion  of  the  premium  deposits  returned  to  their 
policyholders,  but  shall  return  as  taxable  income  all  income 
received  by  them  from  all  other  sources  plus  such  portions  of 
the  premium  deposits  as  are  retained  by  the  companies  for  pur- 
poses other  than  the  payment  of  losses  and  expenses  and  rein- 
surance reserves:  Provided  further,  That  mutual  marine  insur- 
ance companies  shall  include  in  their  return  of  gross  income 
gross  premiums  collected  and  received  by  them  less  amounts  paid 
for  reinsurance,  but  shall  be  entitled  to  include  in  deductions 
from  gross  income  amounts  repaid  to  policyholders  on  account  of 
premiums  previously  paid  by  them,  and  interest  paid  upon  such 
amounts  between  the  ascertainment  thereof  and  the  payment 
thereof  and  life  insurance  companies  shall  not  include  as  income 
in  any  year  such  portion  of  any  actual  premium  received  from 
any  individual  policyholder  as  shall  have  been  paid  back  or 
credited  to  such  individual  policyholder,  or  treated  as  an  abate- 
ment of  premium  of  such  individual  policyholder,  within  such 
year;  and  in  case  of  a  corporation,  joint-stock  company  or  asso- 
ciation, or  insurance  company,  organized  under  the  laws  of  a 
foreign  country,  all  losses  actually  sustained  by  it  during  the 
year  in  business  conducted  by  it  within  the  United  States,  not 
compensated    by    insurance    or    otherwise,    stating    separately    any 


—  21  — 

amounts  allowed  for  depreciation  of  property,  and  in  case  of 
insurance  companies  the  net  addition,  if  any,  required  by  law 
to  be  made  within  the  year  to  reserve  funds  and  the  sums  other 
than  dividends  paid  within  the  year  on  policy  and  annuity  con- 
tracts: Provided  further,  That  mutual  fire  insurance  companies 
requiring  their  members  to  make  premium  deposits  to  provide 
for  losses  and  expenses  shall  not  return  as  income  any  portion 
of  the  premium  deposits  returned  to  their  policyholders,  but  shall 
return  as  taxable  income  all  income  received  by  them  from  all 
other  sources  plus  such  portions  of  the  premium  deposits  as 
are  retained  by  the  companies  for  purposes  other  than  the  pay- 
ment of  losses  and  expenses  and  reinsurance  reserves:  Provided 
further,  That  mutual  marine  insurance  companies  shall  include 
in  their  return  of  gross  income  gross  premiums  collected  and 
received  by  them  less  amounts  paid  for  reinsurance,  but  shall  be 
entitled  to  include  in  deductions  from  gross  income  amounts 
repaid  to  policyholders  on  account  of  premiums  previously  paid 
by  them  and  interest  paid  upon  such  amounts  between  the  ascer- 
tainment thereof  and  the  payment  thereof  and  life  insurance 
companies  shall  not  include  as  income  in  any  year  such  portion 
of  any  actual  premium  received  from  any  individual  policy- 
holder as  shall  have  been  paid  back  or  credited  to  such  indi- 
vidual policyholder,  or  treated  as  an  abatement  of  premium  of 
such  individual  policyholder,  within  such  year;  (sixth)  the 
amount  of  interest  accrued  and  paid  within  the  year  on  its 
bonded  or  other  indebtedness  not  exceeding  one-half  of  the  sum 
of  its  interest  bearing  indebtedness  and  its  paid-up  capital  stock, 
outstanding  at  the  close  of  the  year,  or  if  no  capital  stock,  the 
amount  of  interest  paid  within  the  year  on  an  amount  of  in- 
debtedness not  exceeding  the  amount  of  capital  employed  in  the 
business  at  the  close  of  the  year,  and  in  the  case  of  a  bank,  bank- 
ing association,  or  trust  company,  stating  separately  all  inter- 
est paid  by  it  within  the  year  on  deposits;  or  in  case  of  a  cor- 
poration, joint-stock  company  or  association,  or  insurance  com- 
pany, organized  under  the  laws  of  a  foreign  country,  interest  so 
paid  on  its  bonded  or  other  indebtedness  to  an  amount  of  such 
bonded  or  other  indebtedness  not  exceeding  the  proportion  of  its 
paid-up  capital  stock  outstanding  at  the  close  of  the  year,  or  if 
no  capital  stock,  the  amount  of  capital  employed  in  the  business 
at  the  close  of  the  year,  which  the  gross  amount  of  its  income 
for  the  year  from  business  transacted  and  capital  invested  within 
the  United  States  bear  to  the  gross  amount  of  its  income  derived 
from  all  sources  within  and  without  the  United  States;  (seventh) 
the  amount  paid  by  it  within  the  year  for  taxes  imposed  under 
the  authority  of  the  United  States  and  separately  the  amount  so 
paid  by  it  for  taxes  imposed  by  the  Government  of  any  foreign 
country;  (eighth)  the  net  income  of  such  corporation,  joint-stock 
company  or  association,  or  insurance  company,  after  making  the 
deductions  in  this  subsection  authorized.  All  such  returns  shall 
as  received  be  transmitted  forthwith  by  the  collector  to  the  Com- 
missioner of  Internal  Revenue. 

All   assessments   shall   be   made   and   the   several   corporations, 


—  22  — 

Joint-stock  companies  or  associations,  and  insurance  companies 
ihall  be  notified  of  the  amount  for  which  they  are  respectively 
liable  on  or  before  the  first  day  of  June  of  each  successive  year 
and  said  assessment  shall  be  paid  on  or  before  the  thirtieth 
day  of  June:  Provided,  That  every  corporation,  joint-stock  com- 
pany or  association,  and  insurance  company,  computing  taxes 
upon  the  income  of  the  fiscal  year  which  it  may  designate  in 
the  manner  hereinbefore  provided,  shall  pay  the  taxes  due  un- 
der its  assessment  within  one  hundred  and  twenty  days  after 
the  date  upon  which  it  is  required  to  file  its  list  or  return  of 
income  for  assessment;  except  in  cases  of  refusal  or  neglect  to 
make  su<l»  return,  and  in  cases  of  false  or  fraudulent  returns, 
in  which  cases  the  Commissioner  of  Internal  Revenue  shall,  upon 
the  discovery  thereof,  at  any  time  within  three  years  after  said 
return  is  due,  make  a  return  upon  information  obtained  as  pro- 
vided for  in  this  section  or  by  existing  law,  and  the  assessment 
made  by  the  Commissioner  of  Internal  Revenue  thereon  shall  be 
paid  by  such  corporation,  joint-stock  company  or  association,  or 
insurance  company  immediately  upon  notification  of  the  amount 
of  such  assessment;  and  to  any  sum  or  sums  due  and  unpaid 
after  the  thirtieth  day  of  June  in  any  year,  or  after  one  hundred 
and  twenty  days  from  the  date  on  which  the  return  of  income 
is  required  to  be  made  by  the  taxpayer,  and  after  ten  days'  notice 
and  demand  thereof  by  the  collector,  there  shall  be  added  the 
sum  of  5  per  centum  on  the  amount  of  tax  unpaid  and  interest 
at  the  rate  of  1  per  centum  per  month  upon  said  tax  from  the  time 
the  same  becomes  due. 

(d)  When  the  assessment  shall  be  made,  as  provided  in  this 
section,  the  returns,  together  with  any  corrections  thereof  which 
may  have  been  made  by  the  commissioner,  shall  be  filed  in  the 
office  of  the  Commissioner  of  Internal  Revenue  and  shall  con- 
stitute public  records  and  be  open  to  inspection  as  such:  Pro- 
vided, That  any  and  all  such  returns  shall  be  open  to  inspec- 
tion only  upon  the  order  of  the  President,  under  rules  and  regu- 
lations to  be  prescribed  by  the  Secretary  of  the  Treasury  and 
approved  by  the  President:  Provided  further,  That  the  proper 
officers  of  any  State  imposing  a  general  income  tax  may,  upon 
the  request  of  the  governor  thereof,  have  access  to  said  returns 
or  to  an  abstract  thereof,  showing  the  name  and  income  of  each 
such  corporatioBi,  joint-stock  company,  association  or  insurance 
company,  at  such  times  and  in  such  manner  as  the  Secretary 
of  the  Treasury  may  prescribe. 

If  any  of  the  corporations,  joint-stock  companies  or  associa- 
tions, or  insurance  companies  aforesaid,  shall  refuse  or  neglect  to 
make  a  return  at  the  time  or  times  hereinbefore  specified  in 
each  year,  or  shall  render  a  false  or  fraudulent  return,  such 
corporation,  joint-stock  company  or  association,  or  insurance  com- 
pany shall  be  liable  to  a  penalty  of  not  exceeding  $10,000. 

H.  That  the  word  "State"  or  "United  States"  when  used  in 
this  section  shall  be  construed  to  include  any  Territory,  Alaska, 
the  District  of  Columbia,  Porto  Rico,  and  the  Philippine  Islands, 
when  such  construction  is  necessary  to  carry  out  its  provisions 


—  23  — 

I.  That  sections  thirty-one  hundred  and  sixty-seven,  thirty- 
one  hundred  and  seventy-two,  thirty-one  hundred  and  seventy- 
three,  and  thirty-one  hundred  and  seventy-six  of  the  Revised 
Statutes  of  the  United  States  as  amended  are  hereby  amended 
so  as  to  read  as  follows: 

"Sec.  3167.  It  shall  be  unlawful  for  any  collector,  deputy 
collector,  agent,  clerk,  or  other  officer  or  employee  of  the  United 
States  to  divulge  or  to  make  known  in  any  manner  whatever 
not  provided  by  law  to  any  person  the  operations,  style  of  work, 
or  apparatus  of  any  manufacturer  or  producer  visited  by  him 
in  the  discharge  of  his  official  duties,  or  the  amount  or  source 
of  income,  profits,  losses,  expenditures,  or  any  particular  thereof, 
set  forth  or  disclosed  in  any  income  return  by  any  person  or 
corporation,  or  to  permit  any  income  return  or  copy  thereof 
or  any  book  containing  any  abstract  or  particulars  thereof  to 
be  seen  or  examined  by  any  person  except  as  provided  by  law; 
and  it  shall  be  unlawful  for  any  person  to  print  or  publish  in 
any  manner  whatever  not  provided  by  law  any  income  return 
or  any  part  thereof  or  the  amount  or  source  of  income,  profits, 
losses,  or  expenditures  appearing  in  any  income  return;  and 
any  offense  against  the  foregoing  provision  shall  be  a  misde- 
meanor and  be  punished  by  a  fine  not  exceeding  $1,000  or  by 
imprisonment  not  exceeding  one  year,  or  both,  at  the  discretion 
of  the  court;  and  if  the  offender  be  an  officer  or  employee  of  the 
United  States  he  shall  be  dismissed  from  office  and  be  incapable 
thereafter  of  holding  any  office  under  the  Government. 

"Sec.  3172.  Every  collector  shall,  from  time  to  time,  cause 
his  deputies  to  proceed  through  every  part  of  his  district  and 
inquire  after  and  concerning  all  persons  therein  who  are  liable 
to  pay  any  internal-revenue  tax,  and  all  persons  owning  or  hav- 
ing the  care  and  management  of  any  objects  liable  to  pay  any 
tax,  and  to  make  a  list  of  such  persons  and  enumerate  said 
objects. 

"Sec.  3173.  It  shall  be  the  duty  of  any  person,  partnership, 
firm,  association,  or  corporation,  made  liable  to  any  duty,  special 
tax,  or  other  tax  imposed  by  law,  when  not  otherwise  provided 
for,  in  case  of  a  special  tax,  on  or  before  the  thirty-first  day  of 
July  in  each  year,  in  case  of  income  tax  on  or  before  the  first 
day  of  March  in  each  year,  and  in  other  cases  before  the  day  on 
which  the  taxes  accrue,  to  make  a  list  or  return,  verified  by 
oath  or  affirmation,  to  the  collector  or  a  deputy  collector  of  the 
district  where  located,  of  the  articles  or  objects,  including  the 
amount  of  annual  income  charged  with  a  duty  or  tax,  the  quan- 
tity of  goods,  wares,  and  merchandise  made  or  sold  and  charged 
with  a  tax,  the  several  rates  and  aggregate  amount,  according 
to  the  forms  and  regulations  to  be  prescribed  by  the  Commis- 
sioner of  Internal  Revenue,  with  the  approval  of  the  Secretary 
of  the  Treasury,  for  which  such  person,  partnership,  firm,  asso- 
ciation, or  corporation  is  liable:  Provided,  That  if  any  person 
liable  to  pay  any  duty  or  tax,  or  owning,  possessing,  or  having 
the  care  or  management  of  property,  goods,  wares,  and  merchan- 
dise, articles   or  objects   liable  to  pay   any  duty,   tax,   or   license. 


—  24  — 

shall  fail  to  make  and  exhibit  a  list  or  return  required  by  law, 
but  shall  consent  to  disclose  the  particulars  of  any  and  all  the 
property,  goods,  wares,  and  merchandise,  articles,  and  objects 
liable  to  pay  any  duty  or  tax,  or  any  business  or  occupation 
liable  to  pay  any  tax  as  aforesaid,  then,  and  in  that  case,  it 
shall  be  the  duty  of  the  collector  or  deputy  collector  to  make 
such  list  or  return,  which,  being  distinctly  read,  consented  to, 
and  signed  and  verified  by  oath  or  aflarmation  by  the  person  so 
owning,  possessing,  or  having  the  care  and  management  as  afore- 
said, may  be  received  as  the  list  of  such  person:  Provided  fur- 
ther, That  in  case  no  annual  list  or  return  has  been  rendered  by 
such  person  to  the  collector  or  deputy  collector  as  required  "by 
law,  and  the  person  shall  be  absent  from  his  or  her  residence  or 
place  of  business  at  the  time  the  collector  or  a  deputy  collector 
shall  call  for  the  annual  list  or  return,  it  shall  be  the  duty  of 
such  collector  or  deputy  collector  to  leave  at  such  place  of  resi- 
dence or  business,  with  some  one  of  suitable  age  and  discretion, 
if  such  be  present,  otherwise  to  deposit  in  the  nearest  post  oflBce, 
a  note  or  memorandum  addressed  to  such  person,  requiring  him 
or  her  to  render  to  such  collector  or  deputy  collector  the  list 
or  return  required  by  law  within  ten  days  from  the  date  of  such 
note  or  memorandum,  verified  by  oath  or  affirmation.  And  if  any 
person,  on  being  notified  or  required  as  aforesaid,  shall  refuse 
or  neglect  to  render  such  list  or  return  within  the  time  required 
as  aforesaid,  or  whenever  any  person  who  is  required  to  deliver 
a  monthly  or  other  return  of  objects  subject  to  tax  fails  to  do 
so  at  the  time  required,  or  delivers  any  return  which,  in  the 
opinion  of  the  collector,  is  false  or  fraudulent,  or  contains  any 
undervaluation  or  understatement,  it  shall  be  lawful  for  the  col- 
lector to  summon  such  person,  or  any  other  person  having  pos- 
session, custody,  or  care  of  books  of  account  containing  entries 
relating  to  the  business  of  such  person,  or  any  other  person  he 
may  deem  proper,  to  appear  before  him  and  produce  such  books, 
at  a  time  and  place  named  in  the  summons,  and  to  give  testi- 
mony or  answer  interrogatories,  under  oath,  respecting  any 
objects  liable  to  tax  or  the  returns  thereof.  The  collector  may 
summon  any  person  residing  or  found  within  the  State  in  which 
his  district  lies;  and  when  the  person  intended  to  be  summoned 
does  not  reside  and  can  not  be  found  within  such  State,  he  may 
enter  any  collection  district  where  such  person  may  be  found 
and  there  make  the  examination  herein  authorized.  And  to  this 
end  he  may  there  exercise  all  the  authority  which  he  might  law- 
fully exercise  in  the  district  for  which  he  was  commissioned. 

"Sec.  3176.  When  any  person,  corporation,  company,  or  as- 
sociation refuses  or  neglects  to  render  any  return  or  list  re- 
quired by  law,  or  renders  a  false  or  fraudulent  return  or  list, 
the  collector  or  any  deputy  collector  shall  make,  according  to  the 
best  information  which  he  can  obtain,  including  that  derived 
from  the  evidence  elicited  by  the  examination  of  the  collector, 
and  on  his  own  view  and  information,  such  list  or  return,  ac- 
cording to  the  form  prescribed,  of  the  income,  property,  and 
objects   liable   to   tax   owned   or   possessed   or   under   the    care   or 


—  25  — 

management  of  such  person  or  corporation,  company  or  associa- 
tion, and  the  Commissioner  of  Internal  Revenue  shall  assess  all 
taxes  not  paid  by  stamps,  including  the  amount,  if  any,  due  for 
special  tax,  income  or  other  tax,  and  in  case  of  any  return  of  a 
false  or  fraudulent  list  or  valuation  intentionally  he  shall  add 
100  per  centum  to  such  tax;  and  in  case  of  a  refusal  or  neglect, 
except  in  cases  of  sickness  or  absence,  to  make  a  list  or  return, 
or  to  verify  the  same  as  aforesaid,  he  shall  add  50  per  centum 
to  such  tax.  In  case  of  neglect  occasioned  by  sickness  or  absence 
as  aforesaid  the  collector  may  allow  such  further  time  for  mak- 
ing and  delivering  such  list  or  return  as  he  may  deem  necessary, 
not  exceeding  thirty  days.  The  amount  so  added  to  the  tax  shall 
be  collected  at  the  same  time  and  in  the  same  manner  as  the 
tax  unless  the  neglect  or  falsity  is  discovered  after  the  tax  has 
been  paid,  in  which  case  the  amount  so  added  shall  be  collected 
in  the  same  manner  as  the  tax;  and  the  list  or  return  so  made 
and  subscribed  by  such  collector  or  deputy  collector  shall  be  held 
prima  facie  good  and  sufficient  for  all   legal  purposes." 

J.  That  it  shall  be  the  duty  of  every  collector  of  internal 
revenue,  to  whom  any  payment  of  any  taxes  other  than  the  tax 
represented  by  an  adhesive  stamp  or  other  engraved  stamp  is 
made  under  the  provisions  of  this  section,  to  give  to  the  person 
making  such  payment  a  full  written  or  printed  receipt,  express- 
ing the  amount  paid  and  the  particular  account  for  which  such 
payment  was  made;  and  whenever  such  payment  is  made  such 
collector  shall,  if  required,  give  a  separate  receipt  for  each  tax 
paid  by  any  debtor,  on  account  of  payments  made  to  or  to  be 
made  by  him  to  separate  creditors  in  such  form  that  such  debtor 
can  conveniently  produce  the  same  separately  to  his  several 
creditors  in  satisfaction  of  their  respective  demands  to  the 
amounts  specified  in  such  receipts;  and  such  receipts  shall  be 
sufficient  evidence  in  favor  of  such  debtor  to  justify  him  in 
withholding  the  amount  therein  expressed  from  his  next  pay- 
ment to  his  creditor;  but  such  creditor  may,  upon  giving  to  his 
debtor  a  full  written  receipt,  acknowledging  the  payment  to  mm 
of  whatever  sum  may  be  actually  paid,  and  accepting  the  amount 
of  tax  paid  as  aforesaid  (specifying  the  same)  as  a  further  satis- 
faction of  the  debt  to  that  amount,  require  the  surrender  to  him 
of  such  collector's  receipt. 

K.  That  jurisdiction  is  hereby  conferred  upon  the  district 
courts  of  the  United  States  for  the  district  within  which  any 
person  summoned  under  this  section  to  appear  to  testify  or  to 
produce  books  shall  reside,  to  compel  such  attendance,  produc- 
tion of  books,  and  testimony  by  appropriate  process. 

L.  That  all  administrative,  special,  and  general  provisions  of 
law,  including  the  laws  in  relation  to  the  assessment,  remission, 
collection,  and  refund  of  internal-revenue  taxes  not  heretofore 
specifically  repealed  and  not  inconsistent  with  the  provisions  of 
this  section,  are  hereby  extended  and  made  applicable  to  all  the 
provisions  of  this  section  and  to  the  tax  herein  imposed. 

M.     That  the  provisions  of  this  section  shall  extend  to  Porto 


—  26-- 

Rico  and  the  Philippine  Islands:  Provided,  That  the  administra- 
tion of  the  law  and  the  collection  of  the  taxes  imposed  in  Porto 
Rico  and  the  Philippine  Islands  shall  be  by  the  appropriate 
internal-revenue  officers  of  those  governments,  and  all  revenues 
collected  in  Porto  Rico  and  the  Philippine  Islands  thereunder 
shall  accrue  intact  to  the  general  governments,  thereof,  respect- 
ively: And  provided  further,  That  the  jurisdiction  in  this  section 
conferred  upon  the  district  courts  of  the  United  States  shall,  so 
far  as  the  Philippine  Islands  are  concerned,  be  vested  in  the 
courts  of  the  first  instance  of  said  islands:  And  provided  further, 
That  nothing  in  this  section  shall  be  held  to  exclude  from  the 
computation  of  the  net  income  the  compensation  paid  any  official 
by  the  governments  of  the  District  of  Columbia,  Porto  Rico  and 
the   Philippine  Islands  or  the  political   subdivisions   thereof. 

N.  That  for  the  purpose  of  carrying  into  effect  the  provi- 
sions of  Section  II  of  this  Act,  and  to  pay  the  expenses  of  assess- 
ing and  collecting  the  income  tax  therein  imposed,  and  to  pay 
such  sums  as  the  Commissioner  of  Internal  Revenue,  with  the 
approval  of  the  Secretary  of  the  Treasury,  may  deem  necessary, 
for  information,  detection,  and  bringing  to  trial  and  punishment 
persons  guilty  of  violating  the  provisions  of  this  section,  or 
conniving  at  the  same,  in  cases  where  such  expenses  are  not 
otherwise  provided  for  by  law,  there  is  hereby  appropriated  out 
of  any  money  in  the  Treasury  not  otherwise  appropriated  for 
the  fiscal  year  ending  June  thirtieth,  nineteen  hundred  and  four- 
teen, the  sum  of  $800,000,  and  the  Commissioner  of  Internal  Rev- 
enue, with  the  approval  of  the  Secretary  of  the  Treasury,  is  au- 
thorized to  appoint  and  pay  from  this  appropriation  all  neces- 
sary officers,  agents,  inspectors,  deputy  collectors,  clerks,  mes- 
sengers and  janitors,  and  to  rent  such  quarters,  purchase  such 
supplies,  equipment,  mechanical  devices,  and  other  articles  as 
may  be  necessary  for  employment  or  use  in  the  District  of  Colum- 
bia or  any  collection  district  in  the  United  States,  or  any  of  the 
Territories  thereof:  Provided,  That  no  agent  paid  from  this  ap- 
propriation shall  receive  compensation  at  a  rate  higher  than  that 
now  received  by  traveling  agents  on  accounts  in  the  Internal 
Revenue  Service,  and  no  inspector  shall  receive  a  compensation 
higher  than  $5  a  day  and  $3  additional  in  lieu  of  subsistence, 
and  no  deputy  collector,  clerk,  messenger,  or  other  employee  shall 
be  paid  at  a  rate  of  compensation  higher  than  the  rate  now  being 
paid  for  the  same  or  similar  work  in  the  Internal  Revenue  Ser- 
vice. 

In  the  office  of  the  Commissioner  of  Internal  Revenue  at 
Washington,  District  of  Columbia,  there  shall  be  appointed  by 
the  Commissioner  of  Internal  Revenue,  with  the  approval  of  the 
Secretary  of  the  Treasury  one  additional  deputy  commissioner, 
at  a  salary  of  $4,000  per  annum;  two  heads  of  divisions,  whose 
compensation  shall  not  exceed  $2,500  per  annum;  and  such  other 
clerks,  messengers,  and  employees,  and  to  rent  such  quarters 
and  to  purchase  such  supplies  as  may  be  necessary:  Provided, 
That  for  a  period  of  two  years  from  and  after  the  passage  of 
this   Act   the   force   of   agents,   deputy   collectors,    inspectors,    and 


—  27-^ 

other  employees  not  including  the  clerical  force  below  the  grade 
of  chief  of  division  employed  in  the  Bureau  of  Internal  Revenue 
in  the  city  of  Washington,  District  of  Columbia,  authorized  by 
this  section  of  this  Act  shall  be  appointed  by  the  Commissioner 
of  Internal  Revenue,  with  the  approval  of  the  Secretary  of  the 
Treasury,  under  such  rules  and  regulations  as  may  be  fixed  by 
the  Secretary  of  the  Treasury  to  insure  faithful  and  competent 
service,  and  with  such  compensation  as  the  Commissioner  of 
Internal  Revenue  may  fix,  with  the  approval  of  the  Secretary  of 
the  Treasury,  within  the  limitations  herein  prescribed:  Provided 
further,  That  the  force  authorized  to  carry  out  the  provisions  of 
Section  II  of  this  Act,  when  not  employed  as  herein  provided, 
shall  be   employed   on   general   internal-revenue   work. 

The  following  portion  of  Subdivision  "S"  of  Section  IV  of  the  Tariff 
Act  relates  to  the  continuation  in  force  of  the  present  corporation  ex- 
cise  tax. 

Provided  further,  That  all  excise  taxes  upon  corporations  im- 
posed by  section  thirty-eight,  that  have  accrued  or  have  been 
imposed  for  the  year  ending  December  thirty-first,  nineteen  hun- 
dred and  twelve,  shall  be  returned,  assessed,  and  collected  in  the 
same  manner,  and  under  the  same  provisions,  liens,  and  penal- 
ties as  if  section  thirty-eight  continued  in  full  force  and  effect: 
And  provided  further.  That  a  special  excise  tax  with  respect  to 
the  carrying  on  or  doing  of  business,  equivalent  to  1  per  centum 
upon  their  entire  net  income,  shall  be  levied,  assessed,  and  col- 
lected upon  corporations,  joint  stock  companies  or  associations^ 
and  insurance  companies,  of  the  character  described  in  section 
thirty-eight  of  the  Act  of  August  fifth,  nineteen  hundred  and 
nine,  for  the  period  from  January  first  to  February  twenty-eighth, 
nineteen  hundred  and  thirteen,  both  dates  inclusive,  which  said 
tax  shall  be  computed  upon  one-sixth  of  the  entire  net  income 
of  said  corporations,  joint  stock  companies  or  associations,  and 
insurance  companies,  for  said  year,  said  net  income  to  be  ascer- 
tained in  accordance  with  the  provisions  of  subsection  G  of  sec- 
tion two  of  this  Act:  Provided  further,  That  the  provisions  of 
said  section  thirty-eight  of  the  Act  of  August  fifth,  nineteen  hun- 
dred and  nine,  relative  to  the  collection  of  the  tax  therein  im- 
posed shall  remain  in  force  for  the  collection  of  the  excise  tax 
herein  provided,  but  for  the  year  nineteen  hundred  and  thirteen 
it  shall  not  be  necessary  to  make  more  than  one  return  and 
assessment  for  all  the  taxes  imposed  herein  upon  said  corpora- 
tions, joint  stock  companies  or  associations,  and  insurance  com- 
panies, either  by  way  of  income  or  excise,  which  return  and 
assessment  shall  be  made  at  the  time  and  in  the  manner  pro- 
vided in  this  Act;  but  the  repeal  of  existing  laws  or  modifica- 
tions thereof  embraced  in  this  Act  shall  not  affect  any  act  done, 
or  any  right  accruing  or  accrued,  or  any  suit  or  proceeding  had 
or  commenced  in  any  civil  case  before  the  said  repeal  or  modifi- 
cation;   but  all  rights  and   liabilities   under   said   laws   shall   con- 


—  28  — 

tinue  and  may  be  enforced  in  the  same  manner  as  if  said  repeal 
or  modifications  had  not  been  made.  Any  offenses  committed  and 
all  penalties  or  forfeitures  or  liabilities  incurred  prior  to  tho 
passage  of  this  Act  under  any  statute  embraced  in  or  changed, 
modified,  or  repealed  by  this  Act  may  be  prosecuted  or  punished 
in  the  same  manner  and  with  the  same  effect  as  if  this  Act  had 
not  been  passed.  No  Act  of  limitation  now  in  force,  whether  ap- 
plicable to  civil  causes  and  proceedings  or  to  the  prosecution 
of  offenses  or  for  the  recovery  of  penalties  or  forfeitures  em- 
braced in  or  modified,  changed,  or  repealed  by  this  Act  shall  be 
affected  thereby  so  far  as  they  affect  any  suits,  proceedings,  or 
prosecutions,  whether  civil  or  criminal,  for  causes  arising  or  acts 
done  or  committed  prior  to  the  passage  of  this  Act,  which  may 
be  commenced  and  prosecuted  within  the  same  time  and  with  the 
same  effect  as  if  this  Act  had  not  been  passed. 

T.  If  any  clause,  sentence,  paragraph,  or  part  of  this  Act 
shall  for  any  reason  be  adjudged  by  any  court  of  competent  juris- 
diction to  be  invalid,  such  judgment  shall  not  affect,  impair,  or 
invalidate  the  remainder  of  said  Act,  but  shall  be  confined  in  its 
operation  to  the  clause,  sentence,  paragraph,  or  part  thereof 
directly  involved  in  the  controversy  in  which  such  judgment  shall 
have  been  rendered. 

U.  That  unless  otherwise  herein  specially  provided,  this  Act 
shall  take  effect  on  the  day  following  its  passage. 

Approved,  9.10  p.  m.  October  3,  1913. 


For  information  concerning  the  Income  Tax 
and    the   preparation   of   statements    consult 

TRUST    DEPARTMENT 

of 

SAVINGS  UNION   BANK  AND  TRUST  COMPANY 


Savings  Union  Bank  and  Trust  Company 

INSTRUCTIONS  OF  UNITED  STATES 

TREASURER  REGARDING 

THE  INCOME  TAX 

Upon  receipt  of  the  instructions  from  the  Treasurer  of  the 
United  States  concerning  the  collection  of  the  Income  Tax,  Col- 
lector Scott  issued  the  following  notice  to  banks  and  kindred 
institutions:. 

In  the  rough  draft  of  regulations  regarding  the  deduc- 
tion of  the  income  tax,  at  the  source,  on  interest  maturing 
on  bonds,  etc.,  submitted  herewith,  you  will  find  a  require- 
ment that  a  license  be  obtained  and  a  proper  surety  bond 
filed  before  any  person,  firm,  or  corporation  can  undertake 
the  collection  of  foreign  items  of  income.  You  are  advised 
that,  for  the  time  being,  a  written  application  for  such 
license,  addressed  to  the  Collector  of  Internal  Revenue, 
will  be  considered  suflicient  compliance  with  the  law. 

The  license  forms  not  yet  having  been  prepared,  the 
time  for  taking  out  the  license  and  filing  bond  is  extended 
to  December  1,  1913.  The  application  for  the  license, 
however,  as  herein  explained,  must  be  made  to  this  oflace 
before  further  foreign  collections  are  made. 
Respectfully, 

JOSEPH  J.  SCOTT,  Collector. 

INSTRUCTIOXS   OF   THE   UNITED    STATES   TREASURER 
REGARDING  THE  INCOME  TAX. 

Regulations  regarding  the  deduction  of  the  Income 
Tax  at  the  source  on  interest  maturing  on  bonds, 
notes  and  other  similar  obligations  of  corporations, 
joint-stock  companies  or  associations,  and  insurance 
companies  under  the  provisions  of  Section  2  of  the  Act 
of  October  3,  1913: 

TAX   TO   BE   DEDUCTED    AT    SOUTICE. 

Under  the  Income  Tax  Law  enacted  October  3,  1913,  a 
tax  of  one  per  cent,  designated  in  the  law  as  the  normal  tax, 
shall  be  deducted  at  "the  source,"  beginning  November  1, 
1913,   from  all  income   accruing  and   payable   to 

Every  citizen  of  the  United  States  whether  residing  at 
home  or  abroad,  and  to 

Every  person  residing  in  the  United  States  though  not  a 
citizen  thereof  which  may  be  derived  from  interest  upon  bonds 
and  mortgages  or  deeds  of  trust  or  other  similar  obligations, 
including  equipment  trust  agreements  and  receivers'  certifi- 
cates, of  corporations,  joint-stock  companies  or  associations, 
and  insurance  companies,  although  such  interest  does  not 
amount  to  $3,000,  excepting  only  the  interest  upon  the  obliga- 
tions of  the  United  States  or  its  possessions,  or  a  State  or  any 
political  subdivision  thereof. 

—  29  — 


—  30  — 

The  term  "debtor"  as  hereinafter  used  shall  be  construed 
to  cover  all  corporations,  joint-stock  companies  or  associations, 
and   insurance   companies. 

WHEN  TAX  SHALL  BE  WITHHELD  BY  DEBTOR. 

For  the  purpose  of  collecting  this  tax  on  all  coupons  and 
registered  interest  originating  or  payable  in  the  United  States 
the  source  shall  be  the  debtor  (or  its  paying  agent  in  the 
United  States),  which  shall  deduct  the  tax  when  same  is  to  be 
withheld  and  no  other  bank,  or  trust  company,  banking  tirm 
or  individual  taking  coupons  or  interest  orders  for  collection, 
or  otherwise,  shall  withhold  the  tax  thereon;  provided,  that 
all  such  coupons  or  orders  for  registered  interest  are  accom- 
panied by  certificates  of  ownership,  signed  by  the  owners  of 
the  bonds  upon  which  the  interest  matured.  These  certificates 
shall  be  in  the  forms  hereinafter  prescribed,  and  each  separate 
certificate  shall  be  made  out  by  the  owner  of  the  bonds  for  the 
coupons  or  interest  orders  for  each  separate  issue  of  bonds  or 
obligations  of  each  debtor. 

WHEN  TAX  SHALL  BE  WITHHELD  BY  FIRST  COLLECTING 

AGENCY. 

If,  however,  the  coupons  or  interest  orders  are  not  accom- 
panied by  certificates  as  prescribed  above,  the  first  bank,  trust 
company,  banking  firm,  or  individual,  or  collecting  agency 
receiving  the  coupons  or  interest  orders  for  collection,  or 
otherwise,  shall  deduct  and  withhold  the  tax  ana  shall  attach 
to  such  coupons  or  interest  orders  its  own  certificate,  giving 
the  name  and  address  of  the  owner,  or  the  person  presenting 
such  coupons  or  interest  orders,  if  the  owner  is  not  known, 
with  a  description  of  the  coupons  or  interest  orders;  also 
setting  forth  the  fact  that  they  are  withholding  the  tax  upon 
them;  whereupon  the  debtor  shall  not  again  withhold  the  tax 
on  said  coupons  or  interest  orders,  but  in  lieu  thereof  shall 
deliver  to  the  government  the  certificate  of  such  bank,  trust 
company,  etc.,  which  is  withholding  such  tax  money. 

Any  corporation,  collecting  agency,  or  person  first  receiv- 
ing from  the  owner  any  interest  coupons  or  orders  tor  the 
collection  of  registered  interest,  and  to  whom  the  certificates 
above  provided  for  are  delivered,  should  require  the  persons 
tendering  such  coupons  or  orders  for  registered  interest,  to 
satisfactorily  establish  their  identity. 

PAYMENT  OF  REGISTERED  INTEREST  BY  DEBTORS. 

The  debtor  whose  bonds  may  be  registered  both  as  to 
principal  and  interest  shall  deduct  the  normal  tax  of  one  per 
cent  from  the  accruing  interest  on  all  bonds  before  sending 
out  checks  for  said  interest  to  registered  owners  or  before 
paying  such  interest  upon  interest  orders,  signed  by  the 
registered  holders  of  said  bonds  until  there  shall  be  filed 
with  said  debtor  or  its  fiscal  agent  (and  not  later  than  thirty 
days  prior  to  March  1st)  through  whom  said  interest  is 
customarily    paid,    the    proper    certificates    claiming    exemption 


—  31  — 

from  liability  for  said  tax  as  herein  provided,  executed  as 
follows: 

By  a  citizen  or  resident  of  the  United  States,  the  bona  fide 
owner  of  the  registered  obligations,  who  may  claim  exemption 
under  Paragraph  C,  Section  2,  of  the  Federal  Income  Tax 
Law,  or 

By  corporations,  joint-stock  companies  or  associations  or 
insurance  companies,  organized  in  the  United  States,  or  or- 
ganizations, associations,  fraternities,  etc.,  which  are  either 
taxable  or  exempt  from  taxation,  as  provided  in  Paragraph  G, 
Subdivision  A,  of  the  Act,  or 

By  a  bona  fide  resident  and  citizen  of  a  foreign  country, 
claiming   exemption   as   such. 

DESIGNATION  OF  FISCAIi  AGENCIES. 

The  "debtor"  may  appoint  paying  or  fiscal  agents  to  act 
for  it  in  matters  pertaining  to  the  collection  of  the  tax  upon 
filing  with  the  Collector  of  Internal  Revenue  for  its  district 
a  proper  notice  of  the  appointment  of  such  agent  or  agents. 

CERTIFICATES   CliAIMING  EXEMPTION. 

If  the  owners  of  the  bonds  are  individuals  who  are  citizens 
or  residents  of  the  United  States,  the  aforesaid  certificates 
shall  accompany  the  coupons,  or,  with  respect  to  the  interest 
on  registered  bonds,  shall  be  filed  with  the  payer  of  said 
interest,  and  such  certificates  shall  describe  the  bonds  and 
show  the  amount  of  coupons  attached  or  the  amount  of  interest 
due  such  owners  on  registered  bonds  and  the  full  mames  and 
address  of  the  owners,  and  shall  also  state  whether  they  claim 
or  do  not  claim  exemption  from  taxation  at  the  source  provided 
for  in  Paragraph  C  of  Section  2  of  the  Federal  Income  Tax 
Law  ($3,000  and  under  certain  conditions  $4,000)  as  to  the 
income  represented   by  such   coupons   or   interest. 

The  certificates  shall  also  show  the  amount,  if  any,  of 
exemption  claimed  and  the  date  of  signature. 

The  form  of  certificate  to  be  used  for  this  purpose  shall  be 
substantially  as  follows: 

Form  of  certificate  to  be  presented  with  coupons  or 
interest  orders  stating  whether  or  not  exemption  is 
claimed  under  Paragraph  C,  Section  2,  of  the  Federal 
Income    Tax    Law. 

I  do  solemnly  declare  that  I,    , 

a   citizen,    or    resident,    of   the    United    States,    and    residing    at 

,  am  the  owner  of 

dollars     ( $ ) 

in    bonds    of    the    denominations    of    dollars 

( $ )    each,   Nos of   the 

known    as    

bonds    from    which    were    detached    the    accompanying    coupons, 

due    191..,    amounting   to 

dollars    ( $ ) ,  or  upon 

which   there   matured    , . .,    191.  .,    


—  32  — 

dollars    ( $ )    of   registered   interest. 

I  do  (or  do  not)  now  claim  with  respect  to  the  income 
represented    by    said    interest    the    benefit    of    a    deduction    of 

dollars    ( $ )    allowed 

under  Paragraph  C,  Section  2,  of  the  Federal  Income  Tax  Law, 

my  total   exemption   thereunder  being    

dollars. 

(Name) 

(Address) 

(Date)    ,   191.  .. 

Whenever  interest  coupons  accompanied  by  a  certificate  of 
an  individual  who  is  a  citizen  or  resident  of  the  United  States 
as  aforesaid,  are  presented  to  a  debtor  or  its  fiscal  agent  for 
payment,  or  whenever  interest  is  payable  to  such  individual 
on  a  bond  registered  as  to  both  principal  and  interest,  the 
debtor  or  its  fiscal  agent  shall  deduct  and  withhold  the 
amount  of  the  normal  tax,  except  to  the  extent  that  exemption 
is  claimed  in  the  certificate  of  ownership  in  the  form  herein 
prescribed. 

Where  the  interest  to  be  paid  is  registered,  the  same  form 
of  certificate  shall  be  used  where  exemptions  are  claimed,  except 
that  it  shall  be  filed  with  the  debtor  at  least  five  days  before 
the  due  date  of  such  interest. 

BY  WHOM  SIGNED. 

These  certificates  must  be  signed  by  the  claimants  with 
their  full  names  and  contain  their  postofiice  and  street  ad- 
dresses, also  the  date  when  signed. 

Duly  authorized  agents,  trustees  acting  in  a  trust  capacity, 
etc.,  may  sign  such  certificates  for  the  persons  for  whom 
they  act. 

ORGANIZATIONS  WHOSE  INTEREST  COUPONS  ARE  NOT 
TAXED  AT  THE  SOURCE. 

If  the  owners  of  the  bonds  are  corporations,  joint-stock 
companies  or  associations,  or  insurance  companies,  organized 
in  the  United  States,  no  matter  how  created,  or  organized,  or 
if  they  are  organizations,  associations,  or  fraternities,  which 
are  either  taxable  or  exempt  from  taxation  as  provided  in 
Paragraph  G,  Subdivision  A,  of  the  Act,  the  debtor  is  not 
required  to  withhold  or  deduct  the  tax  upon  income  derived 
from  interest  on  such  bonds,  provided  coupons  or  orders  for 
interest  from  such  bonds  shall  be  accompanied  by  a  certificate 
of  the  owner  thereof  certifying  to  such  ownership,  which 
certificate  shall  be  filed  with  the  debtor  when  such  coupons 
or  interest  orders  are  presented  for  payment. 

Such  certificate  shall  be  substantially  in  the  following 
form: 


—  33  — 

Certificates  to  be  furnished  by  organizations  not  sub- 
ject to  tax  on  interest  at  the  source. 

I,    ,  the    of  the 

,    a    of 

,  do  solemnly  declare  that 

said    is  the   owner   of 

dollars   ( $ )   in  bonds 

of    the     denominations     of 

dollars    ( $ )    each,   Nos 

of  the    known   as    

bonds  from  which  were  deducted  the 

accompanying   coupons   due    ,    191.., 

amounting  to    dollars    ( $ ) , 

or  upon  which  there  matured    ,   191.., 

dollars     ( $ )     of 

registered  interest,  and  that  under  the  provisions  of  the  Income 
Tax  Law  of  October  3,  1913,  said  interest  is  exempt  from  the 
payment  of  taxes  collectible  at  the  source,  which  exemption 
is  hereby  claimed. 

(Name) 

(Of) 

(Address) 

(Date)    ,  191.  .. 

This  certificate  must  be  signed  by  the  full  name  of  the 
organization,  stating  its  place  of  business,  and  by  the  president, 
secretary  or  some  other  principal  ofllcer  of  said  corporation 
or  organization  duly  authorized  to  sign  the  same,  together  with 
the  date  of  execution. 

HOW  COIiliECTED  WHEN  NOT  ACCOMPANIED  BY  THE 
CERTIFICATE   OF  OWNER. 

Where  coupons  or  interest  orders  are  not  accompanied  by 
the  ownership  certificates,  the  form  to  be  executed  by  the  first 
bank,  trust  company,  banking  firm,  individual,  or  collecting 
agency,  receiving  the  same  for  collection,  or  otherwise,  which 
must  accompany  the  coupons  or  interest  orders,  shall  be  sub- 
stantially  as   follows: 

Form  of  certificate  to  be  presented  with  coupons  or 
interest  orders  when  not  accompanied  by  certificate  of 
owners. 

I ,  the   of 

the    of    

,    do    solemnly    declare    that   said 

has    (or   have) 

purchased  or  accepted  for  collection  the  accompanying  coupons 

or  interest  orders  amounting  to 

dollars    ($ ),  and  which  represent  interest  matured  on 

dollars    ( $ ) ,    of 

bonds  of  the    and   that    

received  said  coupons  or  orders  for  regis- 
tered   interest   from of 


—  34  — 

,    and    that    no    certificate 

of  ownership  accompanied  said  coupons  or  interest  orders,  and 

hereby    acknowledges 

responsibility  of  withholding  therefrom  the  normal  income  tax 
of  one  per  cent,  in  accordance  with  the  regulations  of  the 
Treasury  Department. 

(Name) 

By 

(Address) 

(Date)    ,   191.  .. 

This  certificate  shall  be  dated  and  signed  by  and  shall  state 
the  address  of  the  corporation,  organization,  collecting  agency, 
or  person  withholding  the  tax  with  full  names   and  addresses. 

FINAL  DISPOSITION  OF  CERTIFICATES. 

The  debtor  or  paying  agent  shall  deliver  all  certificates, 
with  the  list  of  names  and  addresses  of  those  for  whom  the 
tax  has  been  withheld,  showing  amounts,  as  required  by  law, 
to  the  Collector  of  Internal  Revenue  for  their  district  on  or 
before  the  20th  day  of  the  month  succeeding  that  in  which 
said  certificates  were   received  by  them. 

INTEREST  DUE  BEFORE  MARCH  1,  1913. 

The  tax  shall  not  be  withheld  on  coupons  or  registered 
interest  maturing  and  payable  before  March  1,  1913,  although 
presented  for  payment  at  a  later  date. 

LICENSE   REQUIRED   FOR   COLLECTION  OF  INCOME  FROM 
FOREIGN   COUNTRIES. 

All  persons,  firms,  or  corporations  undertaking  for  accom- 
modation or  profit  (this  includes  handling  either  by  way  of 
purchase  or  collection)  the  collection  of  coupons,  checks,  bills 
of  exchange,  etc.,  for  or  in  payment  of  interest  upon  bonds 
issued  in  foreign  countries  and  upon  foreign  mortgages  or  like 
obligations,  and  for  any  dividends  upon  stock  or  interest  upon 
obligations  of  foreign  corporations,  associations,  or  insurance 
companies  engaged  in  business  in  foreign  countries,  are  re- 
quired by  law  to  obtain  a  license  from  the  Commissioner  of 
Internal  Revenue  and  may  be  required  to  give  bond  in  such 
amount  and  under  such  conditions  as  the  Commissioner  of 
Internal  Revenue  may  prescribe. 

BY   WHOM    TAX    IS    WITHHELD. 

The  licensed  person,  firm  or  corporation  first  receiving  any 
such  foreign  items  for  collection  or  otherwise,  shall  withhold 
therefrom  the  normal  tax  of  one  per  cent,  and  will  be  held 
responsible  therefor.  He  (the  licensee)  shall  thereupon  indorse 
or  stamp  thereon  the  words  "Income  Tax  Withheld  by"  (giving 
his  or  their  name,  address,  and  date),  which  shall  be  sufficient 
evidence  to  relieve  subsequent  holders  or  purchasers  from  the 
duty  of  also  withholding  the  income  tax. 

If  the  size  or  nature  of  such  coupons,  checks,  etc.,  makes  it 
impracticable  to  make  said  endorsement  as  above,  a  statement 


—  35  — 

identifying  tlie  item  on  whicli  tax  is  withheld  and  bearing  said 
endorsement  may  be  attached  thereto  with  the  same  effect  as 
if  the  endorsement  was  made  directly  thereon, 

LIST  OF  TAX   COLLECTIONS   ON  FOREIGN  ITEMS. 

Such  licenses  shall  obtain  the  names  and  addresses  of  the 
persons  from  whom  such  items  are  received,  and  shall  prepare 
a  list  of  same  and  file  it  with  the  Collector  of  Internal  Reenut 
for  his  district  not  later  than  the  20th  day  of  the  month  next 
succeeding  the  receipt  of  such  items.  The  list  shall  be  dated, 
and  shall  contain  the  names  and  addresses  of  the  taxable  per- 
sons and  the  amount  of  tax  deducted,  and  from  what  source 
collected. 

CERTIFICATES  TO  SECURE  TAX  EXEMPTION  ON  FOREIGN 

ITEMS. 

In  the  event  such  coupons,  checks  or  bills  of  exchange 
above  mentioned  are  presented  for  collection  by  an  individual 
claiming  the  benefit  of  the  deductions  allowable  under  para- 
graph C,  section  2,  of  the  Federal  Income  Tax  law,  such  indi- 
vidual shall  be  permitted  to  avail  himself  of  the  deduction 
claimed,  upon  the  signing  of  the  form  heretofore  prescribed  for 
coupons  payable  in  the  United  States,  and  no  tax  shall  be  de- 
ducted for  the  amount  of  the  exemption  so  claimed;  or  if 
such  items  are  presented  by  corporations,  joint  stock  companies 
or  associations,  and  insurance  companies,  organized  in  the 
United  States,  the  form  of  certificate  heretofore  prescribed  for 
such  organizations  shall  be  used,  and  in  such  instances  no  tax 
shall  be  deducted. 

In  both  instances  the  licensee  first  receiving  such  items 
shall  retain  such  certificates  for  delivery  with  the  lists  afore- 
said to  the  Collector  of  Internal  Revenue  for  his  district  not 
later  than  the  20th  day  of  the  month  next  succeeding  that  in 
which  said  items  were  received,  and  with  respect  to  said 
coupons,  checks,  or  bills  of  exchange,  said  licensee  shall  attach 
thereto  (identifying  the  items)  or  indorse,  or  stamp  thereon 
the  words  "Income  Tax  Exemption  Claimed  through"  (giving 
name  and  address  of  licensee),  which  shall  be  sufficient  evi- 
dence to  relieve  subsequent  holders  or  purchasers  from  the 
duty  of  also  withholding  the  tax  thereon. 

The  provision  for  collection  of  the  tax  on  foreign  obliga- 
tions set  forth  in  this  section  of  the  regulations  includes  the 
interest  upon  all  foreign  bonds,  even  though  the  coupons  may 
be  at  the  option  of  the  holder,  payable  in  the  United  States  as 
well  as  in  some  foreign  country. 

ACCURATE   RECORD   TO  BE   KEPT   BY   LICENSEE. 

All  persons  licensed  shall  keep  their  records  in  such  manner 
as  to  show  from  whom  every  such  item  has  been  received,  and 
such  records  shall  be  open  at  all  times  to  the  inspection  of 
Internal  Revenue  officers. 


—  36  — 

PENAIiTY  FOR  O^OSSION  TO  OBTAIN  LICENSE. 

Failure  to  obtain  license  or  to  comply  with  regulations  is 
punishable  by  a  fine  not  exceeding  $5,000,  or  imprisonment 
not  exceeding  one  year,  or  both,  in  the  discretion  of  the  court. 
Such  licenses  shall  continue  in  force  until  revoked.  Appli- 
cation for  such  licenses  should  be  made  to  the  Collector  of 
Internal  Revenue  for  the  district  in  which  they  are  engaged 
in  business,  and  may  be  issued  without  cost  to  such  persons 
as  the  Commissioner  may  approve,  upon  their  filing  with  the 
Collector  the  bond   herein  provided  for. 

All  persons  making  application  to  the  Collector  of  Internal 
Revenue  for  such  licenses  shall  register  their  names  and 
addresses  and  state  the  nature  of  the  business  in  which  they 
are  engaged.  Such  application  for  the  license,  accompanied  by 
a  proper  surety  bond,  when  both  have  been  approved  by  the 
Collector,  will  be  considered  a  sufiicient  compliance  with  the 
law  to  enable  the  persons  making  application  to  do  business 
until  February  1,  1914,  without  incurring  the  penalties  pro- 
vided by  law  for  failure  to  procure  the  required  license. 

PENALTY  FOR  FALSE   STATEMENTS. 

If  any  person,  for  the  purpose  of  obtaining  any  allowance 
for  reduction  by  virtue  of  a  claim  for  exemption,  either  for 
himself  or  for  any  other,  knowingly  makes  a  false  statement 
or  false  or  fraudulent  representation,  he  is  liable  under  the 
Act  to  severe  penalties. 

PARTNERSHIPS. 

Where  coupons  or  interest  orders,  presented  for  payment, 
represent  the  interest  on  bonds,  or  other  similar  obligations, 
owned  by  a  partnership,  they  shall  be  accompanied  by  a  certifi- 
cate of  ownership,  which  shall  be  signed  either  in  the  firm's 
name  by  one  member  of  the  firm  or  by  each  individual  member 
of  the  partnership,  and  the  normal  tax  shall  be  withheld  by  the 
debtor  with  respect  to  the  income  represented  by  said  interest. 

Said  certificate  or  ownership  shall  be  in  substantially  the 
following  form: 

FORM  OF  CERTIFICATE  TO  BE  FILLED  OUT  AND  SIGNED 
BY  MEMBERS   OF  PARTNERSHIPS. 

The  following  certificate  should  be  used  when  coupons  or 
interest  orders  are  presented  by  citizens  or  residents  of  the 
United  States  for  collection  of  interest  on  bonds,  or  other 
similar  obligations,  owned  by  the  partnerships  of  which  they 
are  members: 

I    ,   a  member  of  the  firm   or 

partnership  of    of    

and   residing   at    

do  solemnly  declare  that  the  said  partnership  Is  the  owner  of 

( $ )    dollars  of  bonds  of  the 

denomination  of   ( $ )    dollars  each, 

Nos of  the    


—  37  — 

known  as bonds,  from  which  were 

detached  the  accompanying  interest  coupons,  due   

191.  .,  amounting  to   ($ )    dollars, 

or    upon    which   there    matured    191.., 

($ )     dollars   of  registered 

interest,  and  that  the  name  and  address  of  said  firm  or  partner- 
ship, and  the  name  of  the  individual  members  thereof,  and 
their  places  of  residence,  are  as  follows: 


Names  of  partners.  Address. 

(Name  of  partner  signing) 


(Of    firm    of) 

Address . 
Date.  . 


Any  member  of  a  partnership  who  is  entitled  to  a  deduction 
(under  Paragraph  C,  Section  2,  of  the  Income  Tax  Law)  of 
his  prorata  share  of  the  tax  which  may  be  withheld  at  the 
source  of  interest  on  bonds  owned  by  his  copartnership,  as 
above,  may  claim  such  deduction  or  allowance  when  he  shall 
make  his  individual  income  tax  return  for  the  year  in  which 
said  deduction  at  the  source  was  made. 

NON-RESIDENT  FOREIGNERS  OWNING  INTEREST-BEAR- 
ING BONDS  NOT  SUBJECT  TO  TAXATION  ON  INCOME 
FROM  SUCH  BONDS  IF  PROPER  CERTIFICATE  FUR- 
NISHED. 

This  tax  will  not  be  deducted  from  the  income  which  may 
be  derived  from  interest  on  bonds,  mortgages,  equipment  trusts, 
receivers'  certificates,  or  other  similar  obligations  of  which  the 
bona  fide  owners  are  citizens  of  foreign  countries  residing  in 
foreign  countries;  Provided,  that  such  interest  coupons,  or  in 
case  of  wholly  registered  bonds,  the  orders  for  the  payment  of 
such  interest  shall  be  accompanied  by  duly  certified  certificates 
hereinafter  provided  for  to  cover  the  cases  of  foreign  and  non- 
resident owners  of  bonds  and  other  securities. 

Unless  such  proof  of  foreign  ownership  is  duly  furnished, 
the  normal  tax  of  one  per  cent  shall  be  deducted  as  herein 
provided.  Such  certificate  shall  be  in  substantially  the  fol- 
lowing  form: 

Form  of  certificate  to  be  presented  with  coupons  or 
interest  orders,  detached  from  bonds  or  other  obliga- 
tions owned  by  those  who  are  both  citizens  or  subjects 
and  residents  of  foreign  countries. 

I  do  solemnly  declare  that  I  am  not  a  citizen  or  resident 
of  the  United  States  of  America,  but  a  subject  or  citizen  of 
,  and  that  I  am  the  owner  of 


—  38  — 

dollars  of  bonds  of  the  denomination  of 

dollars  each,  Nos 

of  the   known  as 

bonds,  from  which  were  detached  the  accom- 
panying  coupons,    due    191.., 

amounting    to    ( $ )     dollars,    or 

upon  which  there  matured    ,   191.., 

($ )     dollars    of    registered    interest 

and  that,  being  a  non-resident  foreigner,  I  am  exempt  from  the 
income  tax  imposed  on  such  interest  by  the  United  States 
Government  under  the  law  enacted  October  3,  1913,  and  that 
no  citizen  of  the  United  States,  wherever  residing,  or  foreigner 
residing  in  the  United  States,  or  any  of  its  possessions,  has 
any  interest  in  said  bonds,  coupons,  or  interest. 
(Signature  of  owner  of  bonds) 

Address 

Dated ,    191.  .. 

TEMPORARY    PROVISION. 

In  view  of  the  fact  that  the  time  required  for  the  inter- 
pretation of  the  law  and  preparation  and  issuance  of  these 
regulations  brings  the  date  so  near  November  1,  and  that 
many  coupons  payable  upon  that  date  are  already  in  transit 
without  the  prescribed  certificate  attached,  with  a  desire  to 
cause  as  small  an  amount  of  inconvenience  as  possible  to 
bondholders  and  general  business  as  may  be  compatible  with 
the  provisions  of  the  law  and  of  these  regulations,  the  follow- 
ing temporary  provision  is  made: 

On  November  1,  1913,  and  for  fifteen  days  thereafter, 
coupons  presented  to  a  debtor  need  not  be  accompanied  by 
certificates  in  any  of  the  forms  hereinbefore  described,  pro- 
vided that  such  coupons  are  accompanied  by  a  certificate  sub- 
stantially in  the  following  form: 

Form    of    temporary    certificate    which    may    be    used 
only  prior  to  November  16,  1913,  subject  to  substitution. 

I    (or  we)    hereby  certify  that  I  am 

(or  we)  lawfully  entitled  to  present  for  payment  the  accom- 
panying coupons,  or  interest  orders,   amounting  to    

dollars     ($ ),     representing    interest    matured     on    the 

following  bonds  (giving  name  of  debtor  and  designating  the 
description,  style  and  numbers  of  the  bonds);  that  said 
coupons,  or  interest  orders  came  into  my  (or  our)  possession 
unaccompanied  by  a  certificate  of  ownership  of  said  bonds,  in 
any  of  the  forms  required  by  the  regulations  of  the  United 
States  Treasury  Department,  and  that  the  name  and  address 
of  the  owner  of  such  bonds  are  as  follows  (give  name  and 
address  of  owner,  or  if  impossible  to  do  this,  so  state) : 

(Name   of   person,   firm   or   corporation   presenting   coupons) 

(By) 

(Address) 


—  39  — 

On  or  before  February  1,  1914,  certificates  of  the  owner- 
ship of  any  of  the  bonds  upon  which  was  collected  the  interest 
referred  to  in  such  temporary  certificates,  in  any  of  the  forms 
above  set  forth,  may  be  delivered  to  the  debtor;  and  said 
debtor  may  thereupon  return  any  sum  withheld  to  which  the 
owner  of  such  bonds  may  be  entitled  under  the  law  and  regu- 
lations upon  the  facts  disclosed  by  such  ownership  certificates. 
Any  temporary  certificates  relating  to  bonds,  for  which  certifi- 
cates of  ownership  shall  not  have  been  substituted  with  the 
debtor,  shall,  on  or  before  March  1,  1914,  be  delivered  to  the 
Collector  of  Internal  Revenue. 

All  forms  of  certificates  herein  provided  for  shall  be  8 
inches  wide  and  3%  inches  from  top  to  bottom,  and  printed  on 
paper  corresponding  in  weight  and  texture  to  glazed  bond  paper 
17x28,  about  26  pounds  to  the  ream  of  500  sheets,  or  white 
writing  paper  21  x  32,  about  32  pounds  to  the  ream  of  500 
sheets,  and  the  person  or  corporation  first  receiving  coupons 
for  collection  shall  write  or  stamp  his  or  its  name  and  address 
and  date  on  the  back  of  said  certificates. 

W.  H.  OSBORN, 
Collector  of  Internal  Revenue. 
W.  G.  McADOO, 

Secretary  of  the  Treasury. 
Approved  October  25,  1913. 


For  information  concerning  the  Income  Tax 
and    the   preparation   of   statements   consult 

TRUST    DEPARTMENT 

of 

SAVINGS  UNION  BANK  AND  TRUST  COMPANY 


Savings  Union  Bank  and  Trust  Company 


REGULATIONS 

REGARDING  THE  DEDUCTION  AT  THE  SOURCE  OF  THE 
NORMAIi  TAX  OP  ONE  PER  CENT  FROM  INCOME  OF 
INDIVIDUALS,  OTHER  THAN  INCOME  DERIVED  FROM 
INTEREST  UPON  BONDS  AND  MORTGAGES,  OR  DEEDS 
OF  TRUST,  OR  OTHER  SIMILAR  OBLIGATIONS  OF  COR- 
PORATIONS, JOINT-STOCK  COMPANIES,  OR  ASSOCIA- 
TIONS AND  INSURANCE  COMPANIES,  UNDER  THE  PRO- 
VISIONS OF  SECTION  2,  OF  THE  ACT  OF  OCTOBER  3, 
1913. 

The  "source"  in  these  regulations  shall  be  construed  as  refer- 
ring to  the  place  where  the  income  originates. 

BY  VTHOM  THE  NORMAL  TAX  SHALL  BE  DEDUCTED 
AND  WITHHELD. 

All  persons,  firms,  etc.,  mentioned  in  paragraph  E  of  this  law, 
hereinafter  referred  to  as  "withholding  agents,"  namely: 

Copartnerships,  companies,  corporations,  joint-stock  com- 
panies, or  associations,  insurance  companies,  in  whatever  capacity 
acting,  including  lessees,  mortgagors  of  real  or  personal  property, 
trustees  acting  in  any  trust  capacity,  executors,  administrators, 
agents,  receivers,  conservators,  employers  and  all  oflBcers  and 
employes  of  the  United  States  having  the  control,  receipt,  cus- 
tody, disposal  or  payment  of  interest  (except  income  derived 
from  interest  upon  bonds  and  mortgages,  or  deeds  of  trust,  or 
other  similar  obligations  of  corporations,  upon  which  the  normal 
tax  of  1  per  cent  has  otherwise  been  withheld  at  the  source,  as 
provided  by  these  regulations),  rent,  salaries,  wages,  royalties, 
taxable  annuities,  emoluments,  or  other  fixed  or  determinable 
gains,  profits  and  income  of  ANOTHER  PERSON,  exceeding 
$3,000.00  for  any  taxable  year,  except  as  hereinafter  provided, 
shall  deduct  and  withhold  from  such  annual  gains,  profits,  and 
Income  such  sum  as  will  be  sufficient  to  pay  the  normal  tax  of 
1  per  cent  imposed  thereon  by  Section  2  of  this  Act,  and  shall 
make  lawful  return  and  pay  the  taxes  so  withheld  to  the  Col- 
lector of  Internal  Revenue  for  the  district  in  which  said  with- 
holding agent  resides,  or  has  his,  her  or  its  principal  place  of 
business. 

The  normal  tax  of  1  per  cent  shall  be  thus  withheld  from  all 
income  derived  from  fixed  annual  periodical  rent  of  realty  or 
personalty,  interest  (except  as  herein  otherwise  provided),  sal- 
aries, royalties,  taxable  annuities,  and  other  fixed  annual  period- 
ical income  exceeding  $3,000.00. 

-.40  — 


—  41  — 

ITEMS  UPON  WHICH  TAX  IS  NOT  TO  BE  WITHHELD  AT 
THE  SOURCE. 

(1)  Dividends  on  capital  stock,  or  from  the  net  earnings  of 
corporations  and  joint-stock  companies  or  associations  and  insur- 
ance companies  subject  to  like  tax,  when  said  withholding  agents 
are  required  to  make  and  render  a  return  in  behalf  of  another,  as 
provided  herein,  to  the  collector  of  his,  her  or  its  district. 

(2)  Proceeds  of  life  insurance  policies  paid  upon  the  death 
of  the  person  insured  or  payments  made  by  or  credited  to  the 
insured,  on  life  insurance,  endowment,  or  annuity  contracts, 
upon  the  return  thereof  to  the  insured  at  the  maturity  of  the 
term  mentioned  in  the  contract,  or  upon  the  surrender  of  con- 
tract— all  of  which  shall  not  be  included  as  income  under  this 
law — but  this  shall  not  be  construed  to  exempt  said  insurance 
companies  from  withholding  and  paying  the  normal  tax  of  1  per 
cent  on  interest  income  paid  by  insurance  companies  to  bene- 
ficiaries of  policies  when  said  interest  exceeds  $3,000.00. 

(3)  Income  of  an  individual  which  is  not  fixed  or  certain, 
and  payable  at  stated  periods,  or  is  indefinite  or  irregular  as  to 
amount  or  time  of  accrual,  shall  not  be  withheld  at  the  source, 
but  shall  be  returned  and  the  tax  shall  be  paid  thereon  by  the 
individual. 

Income  derived  from  the  following  professions  and  vocations 
come  under  this  head: 

Farmers,  merchants,  agents  compensated  on  the  com- 
mission basis,  lawyers,  doctors,  authors,  investors,  and 
other  professional  persons. 

Such  persons  shall  make  personal  return  of  all  their 
income,  provided  their  total  income  from  all  sources 
exceeds  $3,000.00. 

For  example:  When  a  lawyer  receives  a  retainer  of 
$5,000  as  a  special  fee,  a  deduction  therefrom  shall  not  be 
made  by  the  payer,  but  when  a  lawyer  receives  a  retainer 
of  $5,000  per  annum,  and  the  exemption  claimed  is  $3,000, 
$2,000  of  such  income  would  be  taxed,  and  the  tax  retained 
at  the  source,  or  if  his  exemption  claimed  should  be  $4,000, 
$1,000  of  such  income  would  be  taxed,  and  the  tax  with- 
held at  the  source. 

(4)  The  value  of  property  acquired  by  gift,  bequest,  devise 
or  descent. 

(5)  Interest  upon  the  obligation  of  a  State,  or  any  political 
subdivision  thereof,  and  upon  the  obligations  of  the  United  States 
or  its  possessions;  also  the  compensation  of  the  present  President 
of  the  United  States  during  the  term  for  which  he  has  been 
elected,  and  of  the  judges  of  the  Supreme  and  inferior  courts  of 
the  United  States  now  in  office,  and  the  compensation  of  all 
officers  and  employes  of  a  State  or  any  political  subdivisions 
thereof  paid  by  a  State  or  any  political  subdivision  thereof, 
except  when  such  compensation  is  paid  by  the  United  States  gov- 
ernment. 


—  42-- 

This  exempts  from  the  income  tax  all  salaries  paid  to  an  indi- 
vidual by  a  State  or  any  political  subdivision  thereof;  this  would 
include  salaries  of  State,  county  and  municipal  officers,  including 
the  salaries  of  public  school  teachers,  and  special  compensation 
paid  by  States  or  subdivisions  thereof  for  professional  services, 
whether  in  the  shape  of  salaries  or  special  fees. 

NORMAL.    TAX    ON    THE    SAME    INCOME    IS    TO    BE    WITH- 
HELD  BUT   ONCE. 

The  normal  tax  of  1  per  cent  shall  be  deducted  and  withheld 
at  the  source,  and  payment  made  to  the  Collector  of  Internal 
Revenue  as  provided  in  the  law,  by  the  debtor  or  his,  her  or  its 
duly  appointed  agent  authorized  to  make  such  deduction  and 
payment. 

No  other  person,  firm  or  organization,  in  whatever  capacity 
acting,  having  the  receipt,  custody,  or  disposal  of  any  income,  as 
herein  provided,  shall  be  required  to  again  deduct  and  withhold 
the  normal  tax  of  1  per  cent  thereon,  provided  that  any  person, 
firm  or  organization,  in  whatever  capacity  acting,  other  than  the 
debtor,  who  has  withheld  said  tax,  shall  file  with  the  Collector  of 
Internal  Revenue  for  his,  her,  or  its  district,  a  certificate  in  sub- 
stantially the   following  form: 

Form  of  Certificate  to  be  Filed  by  Persons,  Firms  or 
Organizations,  Required  to  Withhold  and  Pay  Said  Tax, 
Other  than  the  Debtor  at  the  Source. 

To 

Collector  of  Internal  Revenue. 

(Name    of    Collector    of    Internal    Revenue) 

(Give   address    and    designate    district) 

I 

(Name)  (Official   title,    if  any) 

of  the   

(Persons,  firm  or  organization)  (Capacity  in  which  acting) 

of ,  do  solemnly  declare  that  I  (we) 

(Postoffice  address) 

received  of   $ ,  same  being 

(Name  from  whom  received) 

income  derived   from 

(State  source,  whether  rents,  salary  or  other  sources) 

belonging  to 

(Give  name  of  person  to  whom  income  is  due)  (Address) 

and  that  the  tax  amounting  to  $ to  which  said 

person  is  subject,  has  been  withheld  at  the  source  of  said  income 

by 

(Name  of  person  withholding)                                    (Postoffice  address) 
(Signed) 


(Address) 


(Street   and   No.) 


(City  and  State.) 
Date: ,  191.  . 


—  43  — 

EXEMPTIONS  WHICH  MAY  BE   CLAIMED  BY  INDIVIDUALS. 

Any  person,  subject  to  the  normal  tax  of  1  per  cent,  the  amount 
of  which  is  withheld  or  is  to  be  withheld  at  the  source,  wishing 
to  avail  himself  or  herself  of  the  exemption  provided  in  para- 
graph C,  Section  2  of  this  Act  ($3,000  or  $4,000,  as  the  case 
may  be)  must  file  with  the  withholding  agent,  not  less  than 
thirty  days  prior  to  the  day  on  which  the  return  on  his  income 
is  due,  a  notice  in  the  following  form: 

Form  for  Claiming  Exemption  at  the  Source  as  Provided 
in  Paragraph  C,  Section  2,  of  the  Federal  Income  Tax  Law 
of  October  3,  1913. 


To 

(Give  name  of  withholding  agent) 


(Give  postofRce  address) 
I  hereby  serve  you  with  notice  that  I  am  single — married  and 
(Strike  out  s'o  as  to  state  status  correctly) 
living  with  my  wife— husband,  and  now  claim  the  benefit  of  the 

exemption  of  $ ,  as  allowed  in  paragraphs  "C"  and  "D" 

of  Section  2  of  the  Federal  Income  Tax  Law  of  October  3,  1913 

(my  total  exemption  under  said  paragraph  being  $ ). 

(Signed) 

(Address) 

(Street   and   No.) 


(City   and    State) 
Date:     ,  19.  .  .  . 

BY    WHOM    EXEMPTIONS  UNDER    PARAGRAPH  O,  SECTION 
2,  OF    THIS    ACT,  MAY    BE    CLAIMED. 

Every  single  person,  or  every  married  person  not  living  with 
wife  or  husband,  who  is  liable  for  the  normal  income  tax  under 
this  law,  may  claim  a  total  deduction  of  $3,000  from  net  income, 
on  which  deduction  he  or  she  is  exempt  from  normal  tax  of  1  per 
cent. 

Where  a  husband  and  wife  live  together  and  only  one  of 
them  has  an  annual  income  liable  for  the  normal  tax  of  1  per 
cent,  then  the  husband  or  wife  who  has  the  income,  shall  make 
the  return  and  pay  the  said  tax  and  may  claim  and  deduct  an 
exemption  of  $4,000. 

But  if  a  husband  and  wife  live  together,  and  each  has  an 
annual  income  liable  for  the  normal  tax  of  1  per  cent,  then  in 
that  event  they  shall  make  a  separate  return  and  the  $4,000 
exemption  allowed  to  a  husband  and  a  wife  when  living  together 
may  be  claimed  and  deducted  by  either  the  husband  or  wife,  as 
they  may  mutually  agree  (but  not  by  both  separately),  or  the 
said  exemption  shall  be  prorated  between  them  in  proportion  to 
their  net  Income. 


—  44  — 

AMOUNT  OF  EXEMPTION  AliliOWABLE  FOR  1913  UNDER 
PARAGRAPH  C,  SECTION  2  OF  THE  FEDERAL  INCOME 
TAX    LAW. 

For  the  present  year  of  1913  (from  March  1st  to  December 
31st)  exemptions  allowed  under  paragraph  C  of  this  law  will  be 
five-sixths  of  those  of  the  calendar  year,  as  specified  in  para- 
graph D,  namely:  $2,500  if  the  exemption  is  $3,000,  or  $3,- 
333.33,  if  the  exemption  is  $4,000,  as  the  case  may  be. 

WHEN  AND  ON  WHAT  AMOUNT  THE  NORMAL  TAX  OF 
ONE  PER  CENT  SHALL  BE  WITHHELD. 

A  withholding  agent  who  pays  monthly  or  periodically  during 
the  year,  interest  (except  income  derived  from  interest  upon 
bonds  and  mortgages,  or  deeds  of  trust,  or  other  similar  obliga- 
tions of  corporations,  etc.,  upon  which  the  normal  tax  of  1  per 
cent  has  been  withheld  at  the  source,  as  provided  by  these  regula- 
tions), rents,  salaries,  wages,  etc.,  shall  not  withhold  the  said  tax 
until  such  time  as  the  rents,  salary,  wages,  etc.,  shall  have 
reached  an  aggregate  amount  in  excess  of  $3,000  for  said  period. 
When  such  amount  has  been  reached,  he,  she  or  it  shall  withhold 
the  tax  on  the  whole  $3,000  and  excess  thereof,  UNLESS  the 
person  to  whom  the  income  is  due  files  with  him,  her  or  it,  the 
notice  herein  provided,  claiming  exemption  under  paragraph  C 
of  Section  2  of  this  Act,  in  which  case  the  withholding  agent  shall 
withhold  only  the  tax  on  the  income  in  excess  of  said  exemption 
of  $3,000.00  or  $4,000.00  (as  the  case  may  be),  and  the  tax  so 
withheld  shall  be  returned  and  paid  as  required  by  law. 

DEDUCTIONS    TO    BE   MADE   IN    COMPUTING    NET   INCOME. 

Any  person  subject  to  the  normal  income  tax  of  1  per  cent, 
a  part  of  whose  income  is  withheld  or  is  to  be  withheld  at  the 
source,  who  may  wish  to  avail  himself  of  the  deductions  author- 
ized in  subsection  B,  Section  2  of  this  Act,  may  file  either  with 
the  Collector  of  Internal  Revenue  for  the  district  in  which  return 
is  made  for  him,  or  with  the  withholding  agent,  not  less  than 
thirty  days  prior  to  March  1st,  a  return  and  notice  in  substan- 
tially the  following  form: 

Form. 

UNITED  STATES  INTERNAL  REVENUE  RETURN  AND 
APPLICATION  FOR  DEDUCTIONS. 

As  Pl-ovided  by  Paragraphs  B  and  E,  Section  II  of  the 
Federal  Income  Tax  Law  of  October  3,  1913. 

To    

(Name  of  withholding  agent) 


(Street  and  nunnber) 


(Town  or  city)  (State) 

I  hereby  solemnly  declare  that  the  following  is  a  true  and 
correct  return  of  my  gains,  profits  and  income  from  all  other 
sources  for  the  calendar  year  ended  December  31,  19,  .  .  .    (from 


—  45  — 

March  1  to  December  31,  for  the  year  1913),  and  a  true  and 
correct  return  of  deductions  asked  for  under  paragraph  B  of 
Section  II  of  the  Act  of  October  3,  1913,  and  I  hereby  claim 
deductions  as  shown  below: 

Amount  of  gains,  profits,  interest,  rents,  royalties, 
profits  from  copartnerships  and  income  from  all 
other  sources  whatsoever 

Deductions. 

1.  The  amount  of  necessary  expenses  actually  paid  in 

carrying  on   business,   not    including     personal, 

living  or  family  expenses 

2.  All  interest  paid  within  the  year  on  personal  indebt- 

edness  of  taxpayer    

3.  All   national.   State,   county,   school   and   municipal 

taxes  paid  within  the  year   (not  including  those 

assessed  against  local   benefits) 

4.  Losses  actually  sustained  during  the  year  incurred 

in  trade  or  arising  from  fires,  storms,  or  ship- 
wreck, and  not  compensated  for  by  insurance  or 
otherwise 

5.  Debts  due,  actually  ascertained  to  be  worthless  and 

charged  off  within  the  year 

6.  Amount    representing    a    reasonable    allowance    for 

the  exhaustion,  wear  and  tear  of  property  aris- 
ing out  of  its  use  or  employment  in  the  business, 
not  to  exceed  in  the  case  of  mines  5  per  centum 
of  the  gross  value  of  the  output  for  the  year  for 
which  the  computation  is  made,  but  not  includ- 
ing the  expense  of  restoring  property,  or  mak- 
ing good  the  exhaustion  thereof  for  which  an 
allowance  is  or  has  been  made 

7.  The  amount  received  as  dividends  upon  the  stock 

or  from  the  net  earnings  of  any  corporation, 
joint  stock  company,  association  or  insurance 
company  which  is  taxable  upon  its  net  income 

8.  The   amount   of   income,   the   tax   upon   which   has 

been  paid  or  withheld  for  payment  at  the  source 

of  income 


Total  deductions  . 


Note:  Money  or  other  things  of  value,  disposed  of  by  gift,  donation  or 
endowment,  shall  not  be  deducted  or  toe  made  the  basis  for  a  deduction 
from  the  income  of  persons  or  corporations  in  their  tax  returns  under  the 
Income  Tax  Law. 

Date 

(Signed) 

(Address) 

Money  or  other  things  of  value,  disposed  of  by  gift,  dona- 
tions or  endowment,  shall  not  be  deducted  or  be  made  the  basis 
for  a  deduction  from  the  income  of  persons  or  corporations  in 
their  tax  returns  under  the  Income  Tax  Law. 


—  46-- 

AMOUNT  OF  DEDUCTION  ALLOWABLE  FOR  1913  ACCORD- 
ING TO  PARAGRAPHS  "B"  AND  *'D"  OF  SECTION  2  OF 
THIS  ACT. 

For  the  present  year  of  1913  (from  March  1  to  December  31) 
the  deductions  allowed  under  paragraph  "B"  shall  be  five-sixths 
of  the  deductions  allowable  for  a  calendar  year,  as  specified  in 
paragraph  "D"  of  this  law. 

AMOUNT  OF  TAX  TO  BE  WITHHELD  FOR  1913  AND  WHEN 

WITHHELD. 

The  withholding  agent  is  not  required  to  deduct  and  withhold 
prior  to  November  1,  1913,  the  normal  tax  of  one  per  cent  for 
which  an  individual  is  liable. 

Whenever  the  total  amount  of  income  paid  to  any  person  by 
a  withholding  agent,  after  October  31,  1913,  shall  be  in  excess 
of  $3,000,  then,  in  that  event,  the  withholding  agent  shall  h» 
liable  for  and  shall  deduct  and  withhold  the  tax  on  such  amounts, 
unless  such  person  shall  file  a  claim  for  an  exemption  as  allowed 
in  paragraph  "D"  of  this  Act,  the  amount  of  exemption  allowable 
being  $2,500  if  the  annual  exemption  is  $3,000,  or  $3,333.33,  if 
the  annual  exemption  is  $4,000,  as  the  case  may  be. 

PERSONS  PHYSICALLY  UNABLE  TO  MAKE  RETURNS. 

If  a  person,  subject  to  said  tax,  part  of  whose  income  is  with- 
held, or  is  to  be  withheld,  is  a  minor  or  insane  person,  or  is 
absent  from  the  United  States,  or  unable  to  make  the  application 
or  return  because  of  serious  illness,  the  application  or  return 
may  be  made  by  the  withholding  agent  who  shall  make  the 
following  oath  under  the  penalties   of  this  Act: 

Form  of  oath  required  of  a  withholding  agent  when 
acting  for  another  in  filing  return  and  making  applica- 
tion for  deductions  allowable  under  paragraph  "B,"  as 
provided  in  paragraph  *'E,"  Section  2,  of  the  Federal 
Income  Tax  Law  of  October  3,  1913. 

"I  hereby  swear   (or  afiirm)   that  I  have  sufficient  knowledge 

of  affairs  and  property  of 

(Naming  person  and  address  for  whom  acting) 

to  enable  me  to  make  full  and  complete  return  for 

and  that  the 

(Naming  persons) 

return  of  income,  and  application  for  deductions  made  by  me  are 

true  and  accurate." 

(Signed) 

(Address) 

(Street  and  Number) 


(City  and   State) 

Date »  191.... 

Signed  and  sworn  to  before ,  191  • 


—  47  — 


PENALTIES. 

Sub-section  "F"  of  Section  2  of  the  Income  Tax  Law  provides 
inter  alia  as  follows: 

**Any  person  or  any  officer  of  any  corporation  re- 
quired by  law  to  make,  render,  sig:n  or  verify  any  return, 
who  makes  any  false  or  fraudulent  return  or  statement 
with  intent  to  defeat  or  evade  the  assessment  required  to 
be  made,  shall  be  guilty  of  a  misdemeanor  and  shall  be 
fined  not  exceeding  $2,000,  or  to  be  imprisoned  not  ex- 
ceeding one  year,  or  both,  in  the  discretion  of  the  court, 
with  the  costs  of  prosecution. 

W.  H.  OSBORN, 
Commissioner  of  Internal  Revenue. 

Approved  October  31,  1913. 

W.  G.  McADOO,  Secretary  of  the  Treasury." 


For  information  concerning  the  Income  Tax 
and    the   preparation   of   statements   consult 

TRUST    DEPARTMENT 

of 

SAVINGS  UNION  BANK  AND  TRUST  COMPANY 


Savings  Union  Bank  and  Trust  Company 


ADDITIONAL   INSTRUCTIONS 

Concerning   Withholding   of    Normal    Income   Tax   at 
Source  on  Interest  Due  Depositors. 


TREASURY    DEPARTMENT,  INTERNAL    REVENUE    SERVICE. 

San  Francisco,  Cal.,  November  13,  1913. 
To  Banks,  Bankers,  and  Others  Concerned: 

Sirs — You  are  advised  that  banks,  bankers,  trust  companies  and 
other  banking  institutions  receiving  deposits  of  money  are  NOT 
REQUIRED  to  withhold  at  the  source  the  normal  income  tax  of  one 
per  cent  on  the  interest  paid  or  accrued  or  accruing  to  depositors, 
whether  on  open  accounts  or  on  certificates  of  deposit.  The  Govern- 
ment will  require  that  such  interest  be  included  in  the  personal 
return  of  the  person  entitled  to  receive  it. 

It  has  been  called  to  the  attention  of  this  office  that  certain  banks 
are  refusing  to  pay  coupons  for  interest  on  bonds  of  States,  counties, 
cities  or  other  political  subdivisions,  when  such  coupons  are  not 
accompanied  by  certificates  of  ownership,  without  deducting  the 
normal  income  tax  of  one  per  cent,  which  the  law  and  the  regula- 
tions of  the  Treasury  Department  require  shall  be  deducted  at  the 
source  in  paying  the  interest  on  bonds  of  corporations,  joint  stock 
companies,  or  associations  and  insurance  companies. 

You  are  advised  that  the  income  derived  from  interest  upon 
obligations  of  a  State  or  any  political  subdivision  thereof,  or  of  the 
United  States  or  its  possessions,  IS  NOT  SUBJECT  TO  THE 
INCOME  TAX,  and  that  a  certificate  of  ownership  in  connection 
with  coupons  or  registered  interest  orders  for  such  interest  will  not 
be  required  provided  the  interest  coupons  show  clearly  on  their  face 
the  public  character  of  the  bonds,  the  interest  upon  which  they 
represent. 

Please  be  guided  by  this  circular  letter  as  official. 
Respectfully, 

JOSEPH   J.  SCOTT, 
Collector  of  Internal  Revenue,  First  District  of  California. 


Savings  Union  Bank  and  Trust  Company 

Capital  and  Surplus  $3,620,000.00 
Deposits  Tune  30.  1913.  $33,396,936.60 


OFFICERS 

JOHN  S.  DRUM 

President 

G.  D.  GREENWOOD 

Vice-President 

C.  O.  G.  MILLER 

Vice-President 

R.  M.  WELCH 

Vice-President  and  Secretary 

R.  B.  BURMISTER 

Cashier 

A.  M.  WHITTLE 

Assistant  Cashier 

WM.  A.  DAY 

Assistant  Cashier 

D.  L  CLARKE 

Assistant  Secretary 


ARMOR  PLATE  SAFE  DEPOSIT  VAULTS 

JESSE  B.  COOK,  Superintendent 


DIRECTORS 

WALLACE  M.  ALEXANDER  F.  W.  DOHRMANN 

FRANK  B.  ANDERSON  W.  B.  DUNNING 

WAKEFIELD  BAKER  JAS.  J.  FAGAN 

FRED  H.  BEAVER  G.  D.  GREENWOOD 

HENRY  C.  BREEDEN  W.  G.  IRWIN 

F.  J.  CAROLAN  C.  O.  G.  MILLER 

WARREN  D.  CLARK  ARTHUR  A.  SMITH 

WM.  H.  CROCKER  VANDERLYNN  STOW 

HORACE  DAVIS  RALSTON  L.  WHITE 

E.  C.  BURR  JOHN  S.  DRUM 

DEPARTMENTS 

Savings  —  Commercial  —  Trust 


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